Another Kind of HIE — Health Insurance Exchanges & Recent NPRM
The Affordable Care Act (ACA), enacted in March 2010, requires states to establish Health Insurance Exchanges through which individuals and small businesses can purchase affordable insurance. Under the ACA, a state can set up its own exchange, or elect to allow the federal government administer an exchange in their state. States are also allowed to create two exchanges: one for the individual, and and one for the small business insurance market. A state is also allowed to collaborate with its neighboring states to develop regional exchanges. For a good bullet summary of what the ACA requires, the Commonwealth Fund has a posted a Power Point worth checking out. These “HIEs” must begin operation by January 1, 2014.
On October 22, a briefing took place that included Joel Ario, Deputy Director of the HHS Office of Consumer Information and Insurance Oversight (OCIIO), who addressed the current status of the states and their initiatives to develop HealthInsurance Exchanges, and to work together with OCIIO to produce state guidelines. During the briefing, Mr. Ario gave an overview of what states like Massachusetts, Utah and Oregon are already doing to implement the ACA, and mentioned that the federal government is offering states Health Insurance Exchange planning grants of up to $1 million. A transcript and other interesting materials from the October 22 briefing are posted on Alliance for Health Reform’s website.
The OCIIO is currently working with the DHHS to issue regulations and implement many of the provisions of the ACA that address private health insurance. On October 29th DHSS announced in a News Release the availability of competitive funding opportunities for States to design and implement the Information Technology (IT) infrastructure needed to operate Health Insurance Exchanges. On November 3rd, HHS’s Notice of Proposed Rulemaking was published in the Federal Register and proposes that Medicaid eligibility systems will potentially be eligible for an enhanced federal matching rate of 90 percent for design and development of new systems and a 75 percent federal matching rate for maintenance and operations. HHS points out on its website that States must meet a set of performance standards and conditions, including seamless coordination with the exchanges, in order for their Medicaid technology investments to qualify for the enhanced match.
For more information on Health Insurance Exchanges, what they are and how they fit into the big HIE puzzle, visit HHS’s website for HIE IT Systems and OCIIO’s website. To review some of the more detailed requirements for HIEs under the ACA, Continue Reading below…
The following provisions are part of a presentation prepared by Sara R. Collins, Ph.D. of the Commonwealth Fund for the October 22 Alliance on Health Reform Briefing on Health Insurance Exchanges:
ACA Provisions for Insurance Exchanges, 2014
- Each state must establish an American Health Benefit Exchange and a Small Business Health Options Program (SHOP) Exchange by 2014 for individuals and small employers (states can create single exchange)
- If HHS determines in 2013 that a state will not have an exchange operational by 2014, HHS is required to establish and operate an exchange in the state
- Individual and small-group markets not replaced by exchanges, but same market rules apply inside and outside
- Non-grandfathered plans to provide essential benefit package inside/outside
- Qualified health plans (QHPs) certified by exchanges; OPM to contract with carriers to offer at least two multi-state plans through exchanges, one nonprofit; $6 billion in funding for CO-OP program
- QHPs must sell at least silver and gold level plans; plans selling outside can sell at any level (bronze, silver, gold, platinum)
- Carriers selling inside and outside must pool risk of all enrollees
- In 2014, small businesses with up to 100 employees may provide plans for their employees through exchanges, but states can limit to 50 until 2016; may open to 100+ in 2017
- Small employer tax credits (2014), premium and cost sharing subsidies, can be used only for plans purchased through the exchangesHHS to establish permanent risk adjustment mechanism and transitional reinsurance and risk corridor programs
Federal Responsibilities for Exchanges Under ACA
- Establish certification criteria and marketing requirements for QHPs
- Define essential benefit package
- Ensure a sufficient choice of providers including essential community providers who serve predominantly low income/medically underserved
- Ensure QHPs are accredited on clinical quality measures, patient experience ratings, and other measures
- Develop a uniform enrollment form for individuals and employers and present plan information in a standard format
- Implement a quality improvement strategy for health plans
- Provide information on quality measures on health plan performance
- Develop a rating system that will rate QHPs within each benefit level on relative quality and price to be provided on the Internet portal
- Establish model template for an exchange’s Internet portal. The portal will be used to direct individuals/employers to QHPs, to help them determine eligibility for premium/cost-sharing credits, and present standardized information about health plans to facilitate choice
- Determine initial, open, and special enrollment periods
- Establish procedures to allow brokers to enroll individuals in QHPs and assist them in applying for subsidies
State Responsibilities for Exchanges Under ACA
- After HHS issues regulations and sets standards for exchanges, states may adopt before Jan. 2014 the federal standard into their own laws or adopt similar standards that HHS deems equivalent
- HHS will award grants, March 2011- Jan. 1 2015, to states for planning and establishing the exchanges; after that exchanges must be self-sufficient and may charge assessments or user fees to carriers or other means
- Once exchange is operational state responsibilities include:
- Certify qualified health plans
- Operate toll-free hotline and Web site
- Rate qualified health plans, present plan options in a standard format
- Make recommendations to exclude from exchange carriers with history of excessive premium increases (as condition of premium review grants)
- Inform individuals of eligibility for Medicaid and CHIP
- Provide an electronic calculator to calculate plan costs
- Grant certifications of exemption from individual responsibility requirement
- Provide Treasury information necessary to enforce employer payments
- Award grants to “navigators” to educate the public about qualified health plans, distribute information on enrollment and subsidies, facilitate enrollment, and provide referrals on grievances
- In 2017, states may opt out of insurance exchanges with a 5-year waiver, if they can offer all residents coverage at least as comprehensive/affordable.
