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Medicaid Exchange Rule Expected Soon

By Rebecca Adams, CQ HealthBeat Associate Editor

July 27, 2011 -- Medicaid officials will soon issue a proposed rule that top agency official Cindy Mann said would outline the “rules of the road for eligibility and enrollment” for the program’s 2014 expansion under the health care overhaul law.

The Office of Management and Budget received the proposal on June 28 and is conducting a final review, according to a notation on its website.

Speaking at a conference sponsored by the Bipartisan Policy Center, Mann previewed four aspects of the proposed regulation, saying that the rule will be as flexible as possible in allowing states to shape the program. But, she said, state officials will need to make sure that Medicaid officials coordinate with the new exchange markets in checking applicants’ eligibility, align the rules for Medicaid and exchange plans as much as possible, and work toward simplifying enrollment procedures.

On the first point, Mann said that the philosophy will be similar to that in the health care law (PL 111-148, PL 111-152) exchange regulation Health and Human Services officials proposed two weeks ago. In the exchange rule, the federal government planned to defer to state officials on many of the details of how the markets would work.

“There’s no one way to set up a state system to make this work,” said Mann.

She said that the other principles are intended to make it as easy as possible for people to apply for coverage and to make the enrollment process seamless. This builds on the “no wrong door” approach that federal officials have envisioned. The idea is that if a person applies for Medicaid and realizes that he or she is not eligible for that program, federal officials want that person to be referred to the exchange, the Children’s Health Insurance Program or other coverage options.

“We shouldn’t expect them to have to figure out which is the right coverage option for them,” said Mann.

Government officials should guide applicants, she said, even if different members of the family end up in different programs.

Aligning the rules of the program as much as possible will help ensure that the process is not too cumbersome, she said. For instance, programs should create the same kind of income verification system.

At the conference, Director of the Center for Consumer Information and Insurance Oversight Steve Larsen also spoke.

He said that even though few states have passed laws creating an exchange, he expected more to act now that the federal proposed rule has been released and a final rule is expected this year. He predicted that most states would end up setting up a state exchange, rather than allow federal officials to operate one in their states. In his experience as a state official in Maryland, he said he “never met a governor that didn’t want to control their own destiny.”

Rebecca Adams can be reached at [email protected].

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