In less than six months, the major health insurance provisions of the Affordable Care Act will go into effect. This is the second post in a series that offers an overview of action on the new state health insurance marketplaces, or exchanges, and expansion in eligibility for the Medicaid program.
Insurance Marketplace Updates
Beginning on October 1, 2013, Americans who do not have affordable health benefits through a job will be able to go to a new health insurance marketplace in their state and enroll in a private health plan. Adults with annual incomes up to 400 percent of poverty ($45,960 for an individual and $94,200 for a family of four) will be eligible for premium tax credits to help reduce the cost of coverage. In most states, companies with 50 or fewer employees will also be able to select plans through their state’s small-business marketplaces.
Currently, 16 states and the District of Columbia intend to operate a state-based marketplace, while the remaining 34 states will have a federally facilitated marketplace. Seven of these 34 states will conduct plan management activities and/or consumer assistance and outreach functions in a state–federal partnership model. Another seven of the 34 will conduct plan management activities only, and one, Utah, will operate the small-business marketplace while the federal government operates the individual marketplace.
Here is a list of recent state and federal activity.
Action on state-based marketplaces:
- New York state regulators announced that insurance rates for plans sold through the exchange in 2014 are as much as 50 percent lower than what individuals currently pay to purchase a plan on their own.
- California, the District of Columbia, Massachusetts, New Jersey, New York, Rhode Island, and Vermont have decided not to charge smokers higher premiums. Arkansas, Colorado, and Kentucky will charge smokers a higher premium, but not as high as the law allows (up to 50% more than a nonsmoker).
- In D.C., both Aetna and UnitedHealthcare have decreased their proposed rates for plans to be sold in the small-group market exchange; Aetna by 5 percent and UnitedHealthcare by 10 percent.
- Diane Lewis been elected as the new chairperson for the D.C. exchange.
- In Vermont, Blue Cross Blue Shield (BCBS) and MVP Health are the two insurers approved to sell on the exchange. The average silver plan will cost $400 per month. Regulators reduced BCBS proposed premiums by 4.3 percent and MVP Health’s proposed premiums by 5.3 percent.
- Oregon is launching an advertising campaign, investing $2.9 million in outreach. Nearly half of the money will be spent on television spots.
- Oregon has posted approved premium rates. Individual premium rates were reduced from 2 to 30 percentage points.
- Eleven insurers with approved rates expect to offer plans in Oregon’s exchange:
Atrio Health Plans, Inc.; Bridgespan Health Company; Health Net Health Plan of Oregon, Inc.; Health Republic Insurance Company; Kaiser Foundation Health Plan of the Northwest; Lifewise Health Plan of Oregon, Inc.; Moda Health Plan, Inc.; Oregon’s Health CO-OP; PacificSource Health Plans; Providence Health Plan; Trillium Community Health Plan, Inc.
- Colorado was awarded a level-two exchange grant, worth $116,245,677.
- Nevada was awarded a level-one exchange grant, worth $9,020,798.
- New Mexico was awarded a level-one exchange grant, worth $18,600,000.
- Minnesota is using the state’s own insurance program for low-income people, MinnesotaCare, to implement the Basic Health Program. It is the only state in the country so far to move forward with this option. The state’s exchange will also spend about $1.5 million in enrollment outreach.
- To promote enrollment in Connecticut, the state is planning to hand out sunscreen at the beach with “Get Covered” on the bottle , and fly planes over the beaches with banners touting outreach messages.
- According to Politico Pro, Connecticut’s exchange will have over 300 navigators and in-person assisters
- To promote enrollment in Washington, the state is considering branding port-a-potties or sponsoring phone charging stations at music festivals.
- In California, the Department of Health and Human Services awarded $21.9 million to a total of 125 community health centers to support enrollment.
- A press release from California’s Department of Managed Health Care states it has approved the rates proposed by the 13 Qualified Health Plans to be sold in the state marketplace in 2014.
- Marketplaces in Kentucky and Maryland have created short cartoon films to educate consumers about the marketplaces.
- Rhode Island has renamed its marketplace HealthSource RI.
Action on federally facilitated and partnership marketplaces:
- West Virginia was awarded a level-one exchange grant, worth $10,165,134.
- Virginia was awarded a level-one exchange grant, worth $1,247,402.
- BCBS of Louisiana estimates that two-thirds of its customers who buy their own plans will pay the same or less for premiums if they purchase plans in the Louisiana marketplace and take advantage of new federal tax credits.
- Arkansas launched a website for its state–federal partnership exchange.
- Nine members have been appointed to the exchange’s board (the exchange will transition to a state-run marketplace on July 1, 2015):
- Former state legislator Steve Faris; Fred Bean, president of Bean Hamilton Corporate Benefits; John Denery, executive vice president and director of life and health for Stephens Insurance; Mike Castleberry, vice president of network and business development for HealthScope Benefits; Chris Parker, partner at the law firm Eichenbaum, Liles; retired state Supreme Court justice Annabelle Imber Tuck; Sherrill Wise, vice president and treasurer of Dillard’s Inc.; Jerry Jones, M.D., Department of Health; Greg Hatcher, founder and owner of insurance firm the Hatcher Agency
- Read the legislation that will transition Arkansas to a state-run exchange in 2015.
Medicaid Expansion Updates
The Affordable Care Act set a new income eligibility floor for Medicaid, expanding the program to cover all legal U.S. residents beginning in 2014 with incomes up to 138 percent of the federal poverty level ($15,856 for an individual and $32,499 for a family of four).
In June 2012 the Supreme Court ruled that states’ participation in the Medicaid expansion was optional. A state may choose not to participate, forgoing the influx of new federal funds, but still maintain its traditional Medicaid program.
As of July 18, 22 states and the District of Columbia have indicated that they intend to expand Medicaid as it was written in the law; three states are pursuing or expressed an interest in a variation on the expansion; 21 states have indicated they will not participate; and four states remain undecided.
These updates highlight recent state-level action.
- Missouri’s governor is optimistic that the legislature will take action on Medicaid expansion next year.
- Michigan’s governor is touring the state to promote a bill passed by the House that expands Medicaid.
- In Arizona, those who oppose the expansion are trying to get enough signatures to put it on the ballot, which would prevent the expansion from being implemented next year. Supporters of the expansion are attempting to counter this effort with their own petition.
- A workgroup in New Hampshire will deliver recommendations on whether or not to expand Medicaid by mid-October.
Latest Federal Rules, Notices, and Guidance on Affordable Care Act Implementation
- A White House fact sheet reports that in 2014 the lowest-cost silver plan in 11 states where data are available will be about 18 percent lower than the Congressional Budget Office originally estimated.
- Issue brief from HHS’s Assistant Secretary for Planning and Evaluation on premiums in the individual and small-group markets in 2014.
- The Treasury Department announced that it is postponing until 2015 the requirement that employers with 50 or more employees pay a penalty if their workers become eligible for subsidies through the state marketplaces.
- The Treasury Department issued guidance on the postponement.
- White House Blog post on the announcement.
- Timothy Jost Health Affairs blog post on the announcement.
- Medicaid and Children’s Health Insurance Program (CHIP): Essential Health Benefits in Alternative Benefit Plans, Eligibility Notices, Fair Hearing and Appeal Processes, and Premiums and Cost Sharing; Exchanges: Eligibility and Enrollment Final Rule
- Centers for Medicare and Medicaid Services issues FAQs on Qualified Health Plans
- Guidance on Hardship Exemption Criteria and Special Enrollment Periods
- Guidance on the Temporary Enforcement Safe Harbor for Certain Employers, Group Health Plans and Group Health Insurance Issuers with Respect to the Requirement to Cover Contraceptive Services Without Cost Sharing Under Section 2713 of the Public Health Service Act, Section 715(a)(1) of the Employee Retirement Income Security Act, and Section 9815(a)(1) of the Internal Revenue Code
- Exchange Functions: Standards for Navigators and Non-Navigator Assistance Personnel; Consumer Assistance Tools and Programs of an Exchange and Certified Application Counselors Final Rule
- CMS explains that state-run exchanges can collect assessment fees in the first year of the exchange to support the exchange in the second year.