State-based health insurance exchanges in California, Hawaii, Idaho, Nevada, New Mexico, Vermont and Utah were conditionally approved to operate by the Department of Health and Human Services (HHS), Secretary Kathleen Sebelius announced today. Arkansas was conditionally approved to operate a hybrid state partnership exchange.
The Utah exchange interests some for its flexibility because it is limited and only applies to small employers, not the individual market.
HHS also provided more guidance to states today on marketplaces that will be operated in partnership with the federal government, focusing on roles of the states versus roles of the federal government.
With a state partnership exchange, states can continue to serve as the primary points of contact for issuers and consumers, and will work with HHS to establish an exchange that best meets the needs of state residents, the guidance states.
In areas where the law prohibits HHS from completely delegating responsibility to a state, HHS said it will work with states to agree upon processes that help HHS accept state recommendations without the need for duplicative reviews from HHS. The guidance provides states and other stakeholders with details regarding the "State Partnership Exchange" option for the 2014 benefit year. HHS said it intends to provide further details throughout exchange establishment and may refine the policies included here in future years of operation.
In a so-called “State Plan Management Partnership Exchange,” HHS outlined the scope of state responsibilities and those of HHS itself.
With these “management partnerships,” states will have flexibility in how they carry out their role in qualified health plans (QHP) certification while applying the QHP certification standards in a manner consistent with federal-facilitated exchange (FFE) policies. A state could perform an alternate review if it meets or exceeds the FFE standards in connection with how QHP certification standards are applied, HHS stated.
State activities include:
- Recommending plans for QHP certification, recertification and decertification;
- QHP issuer account management; and
- Day-to-day administration and oversight of QHP issuers.
States in a state partnership exchange will carry out similar plan management activities for stand-alone dental plans certified by the exchange.
HHS activities include developing data standards in conjunction with states for QHP data collection and ongoing data reporting and overseeing state certification. HHS will also oversee QHP issuers related to exchange operations outside of the scope of traditional state insurance oversight and QHP certification, including compliance with enrollment transaction requirements.
“States across the country are working to implement the health care law and build a marketplace that works for their residents,” said Secretary Sebelius. “In 10 months, consumers in all 50 states will have access to a new marketplace where they will be able to easily purchase affordable, high quality health insurance plans, and today’s guidance will provide the information states need to guide their continued work.”
Today’s conditional approvals follow those previously granted to Colorado; Connecticut; Washington, D.C.; Kentucky; Massachusetts; Maryland; Minnesota; New York; Oregon; Rhode Island and Washington to operate state-based exchanges and to Delaware to operate a state partnership exchange.
To date, 20 states/jurisdictions have been conditionally approved to partially or fully run their marketplaces – with the remaining states having until Feb. 15 to apply for a state partnership exchange. More than half the states will rely on the federal government, whether they welcome this development or not, as some have made clear.
Under the Patient Protection and Affordable Care Act (PPACA), consumers and small businesses will have access to a new marketplace starting in 2014 where they can access quality, affordable private health insurance. These are similar to those choices that will be offered to members of Congress.
Consumers in every state should be able to buy insurance from qualified health plans directly through these marketplaces by Jan. 1, 2014, and may be eligible for tax credits to help pay for their health insurance. In states that have eschewed working with HHS, the agency will step in and create its own exchange, which will be ready to enroll on Oct. 1 of this year, agency officials have said.
HHS said it recognizes that even with an FFE, states will continue to perform regulatory activities such as reviews of health plan rates, benefits and provider networks with respect to all plans offered in the state, both inside and outside the exchange. Therefore, even where a state partnership exchange is not operating, HHS will work with states to integrate state reviews into the federal exchange process for certifying QHPs.
HHS will evaluate potential QHPs against all QHP certification standards in the FFEs. HHS says it believes that articulating a reasonable interpretation for each standard will improve the state-federal relationship, streamline HHS’ process for reviewing state work, and offer issuers additional consistency in complying with state and federal standards.
While the law does not allow HHS to completely delegate QHP certification to states with an FFE, HHS said it will work with states to agree upon processes that maximize the probability that HHS will accept state recommendations without the need for duplicative reviews from HHS. Specifically, HHS will accept or respond to state QHP recommendations within 14 business days of receipt, on the condition that the state has followed processes previously outlined processes and agreements.
HHS said it does not intend to re-review QHP data or otherwise duplicate work performed by the state. HHS will notify the state in writing of any concerns that preclude HHS approval of its recommendations; the state will have nine business days following this notification to respond to HHS’ concerns and request reconsideration of HHS’ decisions. HHS will notify the state of its final decision and basis for the decisions within five business days of receipt of the state’s response, it said.
The federal exchanges will charge plans a user fee of up to 3.5 percent of premiums on qualified health plans that are part of the federal exchange, and the state-based exchanges will find their own solutions for revenue, said Gary Cohen, director of the Center for Consumer Information and Insurance Oversight (CCIIO.)
HHS will also provide consumer support with a live chat system and a call center, and it is building a website so that consumers can compare plans and enroll in a qualified health plan.
The CMS is building a data services hub, and it has completed the technical design for that project, Cohen said. The hub is now in the testing phase, Cohen said last fall.
Agents and Brokers--More Guidance Coming
As for agents and brokers in all FFE states, including in states where a State Consumer Partnership Exchange is operating, they will use FFE agent and broker web portal, which will allow agents and brokers to sign an agreement with the exchange and complete exchange training and registration. Agents and brokers are also eligible to serve as Navigators, HHS said.
However, agents and brokers who choose to work as navigators cannot be compensated for enrolling individuals into either QHPs or other non-QHP health insurance or health plans by statute. HHS said today it plans to issue further guidance on the role of agents and brokers in an exchange.
It is still up to individual states, HHS made clear, to determine whether to allow agents to enroll people in QHPs through the exchange. States will continue to set standards for the agent and broker industry and to play their traditional role in licensing and overseeing agents and brokers, HHS assured.
To learn more about exchange conditional approvals, visit: http://www.cciio.cms.gov/resources/factsheets/state-marketplaces.html
For more information on exchanges, visit: http://www.healthcare.gov/exchanges