Working poor could get a new type of plan

The Centers for Medicare & Medicaid Services (CMS) has drafted regulations for a program that could help some states crowd commercial insurers out of directly serving the health coverage market for the working poor.

CMS is getting ready to publish the "Basic Health Program" (BHP) draft regulations Wednesday in the Federal Register.

CMS wrote the regulations to implement Section 1331 of the Patient Protection and Affordable Care Act (PPACA).

Some moderate, purple states have been trying to insure the working poor by using federal Medicaid expansion money to help residents buy private exchange coverage.

The BHP system would give other states a tool they could use to move in the opposite direction.

In those states, policymakers who think government health plans are more efficient than private plans could use the BHP system to offer a Medicaid-like or Medicare-like program for the working poor.

Moderate-income people in those states would pay for coverage from a government-run BHP plan rather than using federal subsidies to buy commercial health coverage through the new PPACA public exchange system.

Officials seem to assume in the draft regulations that state BHP managers would get the health coverage provided from private health insurers, health maintenance organizations or provider networks, and that most states would offer people a choice of at least two BHP "standard health plan" options.

A state can "enter into a regional compact with other states for joint procurement of standard health plans," officials say.

Regions with a state also could form compacts with other states, or regions in other states, officials say.

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