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News & Press: Government Affairs News

CMS Releases Guidance to States Seeking ACA Waivers

Tuesday, May 16, 2017   (0 Comments)
Posted by: Bradley Coffey, MA, AAOE Government Affairs
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Baltimore, MD - The Centers for Medicare and Medicaid Services (CMS) under the new leadership of Administrator Seema Verma has released new information to help states seeking waivers from requirements of the Affordable Care Act. The new tool is intended to help states establish high-risk pools/state-operated reinsurance programs.

The waivers, known as Section 1332 Waivers or State Innovation Waivers, are intended to allow states to implement "innovative ways to provide access to quality health care that is at least as comprehensive and affordable as would be provided absent the waiver, provides coverage to a comparable number of residents of the state as would be provided coverage absent a waiver, and does not increase the federal deficit." High-risk pools and reinsurance programs are seen by Republicans and Democrats alike as possibly innovative ways of decreasing costs of providing insurance to an expanded population while keeping premiums low.

Under a state-reinsurance program, states provide subsidies to insurers for covering more high-risk individuals such as those with pre-existing conditions. High-risk pools are a little more controversial and involve putting high-risk individuals into pools separate from less riskier people to contain the risk to one group. Typically, those purchasing insurance in the high-risk pool pay more in premiums than those in the no- and low-risk pool.

As of January 1, 2017 four states have applied for a Section 1332 waiver, Alaska, California, Hawai'i, and Vermont. Should these applications be approved, expect to see new plan options in state exchanges during the next open-enrollment periods. We expect to see more applications filed for Section 1332 Waivers throughout the year.


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