This resource center tracks waiver proposals once they are posted for public comment either with the state or with the federal government. Please contact us with information about proposals moving forward in other states.
Reinsurance provided by the State of Alaska reduces premiums for marketplace coverage. The state’s reinsurance system pays claims for people with certain listed high-cost conditions.
Since reinsurance lowers premiums, the federal government spends less in premium tax credits. The federal government will pass-through to Alaska the amount of premium tax credit dollars saved, and Alaska will use this funding to partially offset the cost of providing reinsurance. Our short analysis provides more details.
Waives establishment of SHOP (Small Business Health Options Program–the exchange for small businesses).
SHOP does not mesh well with Hawaii’s Prepaid Health Plan—a 40-year old state law that requires Hawaii employers to cover their employees. Hawaii’s law requires employers with at least one employee working at least 20 hours per week to provide health coverage. Employees pay, at most, 1.5 percent of their wages for this coverage, which is the equivalent of a platinum or gold plan. Therefore, Hawaii received a waiver of the requirement to provide silver plans, which are less comprehensive than what the state already requires, and employers directly purchase plans for their employees instead of using SHOP.
The money that the federal government would have spent for small business health care tax credits in Hawaii under the ACA instead goes towards a state fund that helps small business employers pay their share of employee premiums.
Waiver approved September 22, 2017, but with less federal funding than the state requested.At this juncture, it is not clear whether the waiver will be implemented.
Reinsurance: Minnesota now reinsures claims above a threshold (called an attachment point) and below a reinsurance cap: Minnesota’s reinsurance programs pays 80 percent of those claims while 20 percent remain the responsibility of the original insurer. Since this has lowered premiums, Minnesota seeks pass-through of the federal dollars that would otherwise be spent for premium assistance.
Additionally, since Minnesota has a Basic Health Program, funded in part with non-BHP funds, Minnesota sought attribution of some of the savings achieved through reinsurance to the Basic Health Plan trust fund. This aspect of Minnesota’s waiver has been denied by CMS. Minnesota’s Governor is protesting this decision, and has written to CMS that the resulting loss of Basic Health funds would be more than the amount of funding that would be gained from the 1332 waiver for reinsurance.
Reinsurance: Oregon proposes to provide reinsurance, funded partly through an assessment on fully insured private plans and on self-insured public plans, partly through excess fund balances from two other state health insurance related funds. The reinsurance program will reimburse 50 percent of claims between an attachment point (to be determined) and a $1 million cap.
Since the reinsurance system will lower premiums, Oregon would seek pass-through of federal dollars that would otherwise be spent for premium assistance. The pass-through will help fund the reinsurance system.
[Back to 1332 State Innovation Waiver Resource Center]
The draft application was open for comment to the Idaho Department of Insurance through December 15, 2017.
Eligibility: Idaho proposes to use a 1332 waiver to extend marketplace coverage to low-income adults with incomes below 100 percent of poverty, changing the rules for premium tax credits instead of expanding Medicaid. Simultaneously, Idaho will seek a Medicaid 1115 waiver to provide coverage for people with complex needs up to 400 percent of poverty. Idaho says that the proposed Medicaid waiver, plus a state-run reinsurance system for people with specific listed conditions, will lower marketplace premium costs.
After the state public period on the proposed waivers closed, Idaho took two actions that could undermine marketplace stability, leave residents uncovered for some health services, and create hurdles to Medicaid enrollment. These actions are not mentioned in the draft waiver proposals: the Insurance Commission has invited insurers to file “state-based plans” that would not cover all of the essential health benefits that marketplace plans must cover and that would vary premiums based on health status; and the bill authorizing the waivers would also create work requirements for adults receiving Medicaid. Legal authority for the waiver is doubtful.
Reinsurance: Maine proposed to establish a reinsurance program, which would partially reimburse plans for enrollees whose claims exceed a threshold (called an attachment point) of $47,000 through a ceiling of $77,000; and fully reimburse claims that exceed $77,000. The reinsurance program will be funded with a combination of fees, assessments on commercial insurers and on third-party administrators of self-insured plans, premiums paid by insurers who cede claims to the pool, and federal pass through dollars: since Maine projects that the reinsurance program will reduce premiums by 9% in 2019, for example, it seeks pass through of the amount of federal premium tax credit dollars saved.
Reinsurance: Maryland proposes to establish a reinsurance program, which would pay 80 percent of claims between an attachment point (to be determined) through a ceiling of $250,000 in its first year of operation, with possible adjustments in future years. The reinsurance program will be funded through assessments on certain health plans and on Medicaid managed care plans, reinstating assessments that the federal government would have collected under Section 9010 of the Affordable Care Act, which has been suspended. Maryland projects that the reinsurance program will lower premium rates by 30%. During the state public comment process, concerns were raised about whether reinsurance and risk adjustment would be duplicative and would disadvantage one carrier. Maryland is commissioning an actuarial study about that and could make further adjustments if so.
State administered cost sharing reduction payments, other changes:: Massachusetts is exploring a variety of reforms, some under Section 1332, and others under another section of the Affordable Care Act (Section 1321(e)) that uniquely authorizes Massachusetts, which offered state-subsidized coverage through an exchange marketplace pre-dating ACA, to continue some of its earlier initiatives.
In a 1332 application submitted to CMS in the fall of 2017, Massachusetts proposed to use federal pass through money to provide advance payments to insurers operating cost-sharing reduction plans when federal CSR payments disappeared. This proposal was deemed incomplete by CMS – CMS said it was too close to the 2018 enrollment period to be workable. Other changes Massachusetts has considered but not yet proposed to CMS are:
- instead of federal employer responsibility payments, which have not yet been fully enforced, require employers who do not insure their employees to make payments to the state – Massachusetts’ employer responsibility laws would follow a different structure than ACA’s and would include smaller employers; and
- administer small business tax credits, coordinating credits with other Massachusetts small group insurance initiatives.
Massachusetts also proposes to continue allowing group plans to use some rating factors not otherwise allowable, using Section 1321(e) authority, and is exploring modifications to federal risk adjustment.
Reinsurance: New Hampshire drafted a proposal to provide reinsurance, funded partly by an assessment on insurers. Though the NH Insurance Department initially posted its draft waiver application on July 19, 2017 for public comment, the Governor opposed the assessment, so the proposal is currently on hold.
Reinsurance: New Jersey proposes to establish a reinsurance program, which would partially reimburse plans for enrollees whose claims exceed a threshold (called an attachment point) through a ceiling. The attachment point and ceiling would be set annually through administrative action, but for 2019, the proposed attachment point is $40,000 after which the reinsurance system would pay 60% of claims up to a $215,000 cap. New Jersey expects its waiver to reduce premiums by 15%. It would fund the reinsurance system from three sources: state general fund revenue, state-administered shared responsibility (“individual mandate”) payments that replace the federal tax for going without insurance, and with a pass through of the amount of federal premium tax credit dollars saved.
Individual mandate: Although federal legislation has now zeroed out the tax penalty for not having insurance, the individual mandate remains in federal law; Ohio sought to waive this. However, Ohio’s application did not provide a reason or explain its waiver program and CMS thus deemed it incomplete on May 17, 2018.
Waiver application withdrawn September 29, 2017 due to lack of timely approval by CMS.
Reinsurance: State proposed to provide reinsurance, funded partly through state assessments on fully-funded and self-funded health insurers.
Reinsurance would partially reimburse plans for enrollees whose claims exceed a threshold (called an attachment point) up to a cap.
Since the reinsurance system would lower premiums, Oklahoma sought pass-through of the amount of federal premium credit dollars saved. This pass-through would be used to help fund the reinsurance system.
Oklahoma negotiated details of this waiver request with the federal government and expected approval by September 25 in time to lock in health insurance rates for the 2017 plan year. However, since the federal government had not approved the request in this time frame, Oklahoma withdrew its waiver application September 29, 2017.
Pending, but on hold. Though this waiver request has not been formally withdrawn, Vermont is not pursuing it.
Vermont wanted to waive requirement to set up a SHOP internet portal and instead allow small employers to enroll in qualified health plans directly with insurers.
HHS determined the waiver application to be incomplete, but separately issued guidance permitting states to allow for direct enrollment into SHOP through 2018.
Reinsurance: Wisconsin proposes to establish a reinsurance program, which would partially reimburse plans for enrollees whose claims exceed a threshold (called an attachment point) of $50,000 up to cap of $250,000. The reinsurance program will be funded with a combination of state general purpose revenue and federal pass through dollars: since Wisconsin projects that the reinsurance program will reduce premiums by 10% in 2019, it seeks pass through of the amount of federal premium tax credit dollars saved.
[Back to 1332 State Innovation Waiver Resource Center]
Sought to offer health insurance options to individuals ineligible to purchase qualified health plans due to immigration status. Though the new enrollees would not be eligible for APTC, they would use California’s marketplace to enroll.
California decided to withdraw its waiver request January 2017.
Waiver has been withdrawn.
Standardized plan, change in structure of premium credits, changes in enrollment, reinsurance: Iowa originally proposed to offer a single standardized silver plan to marketplace enrollees instead of requiring marketplace issuers to sell at least one silver plan, cost sharing reduction variations of that plan, and one gold plan. Subsequent to filing its waiver application, Iowa has submitted amendments that would again provide cost sharing reductions (that is, plans with reduced copayments and deductibles) to some (but not all) of the low to middle income Iowans qualified for federal help - Iowa's proposal would have eliminated cost sharing help for residents 200-250% of poverty, and did not include Native Americans cost-sharing protections.
Iowa also proposed changes in the premium tax credit structure: only people buying the standardized silver plan would be eligible for credits; they would get flat premium credits based on their age and income and people over 400 percent of poverty could also have received credits. However, the amount that people would be left to pay for premiums was not a set percentage of their income: it depended on insurer premium rates and on the amount of federal funding passed on to Iowa, so there was no guarantee that people would be left with an affordable share of premiums.
Iowa also proposed a state-based enrollment system. It would not have screened and referred eligible residents to Medicaid, would not have provided retroactive coverage when there were errors, and would have altered special enrollment periods to require continuous coverage.
Finally, Iowa proposed a reinsurance system that would pay 85 percent of claims between $100,000 and $3 million, and all claims above $3 million. Iowa wanted to divide the money that the federal government saved in premium tax credits between Iowa’s new reinsurance program and its flat credit program.
CMS raised a number of questions about the proposal during the review process, including questions about financial estimates. CMS pointed out that the amount of federal funding Iowa would receive was not certain: it would be calculated based on the amount of federal premium credit savings Iowa achieved, taking into account any differences in employer and individual responsibility payments. CMS wrote, “If your waiver plan is approved, the Departments will require as a condition of approval that the state ensure sufficient funds, on an annual or other appropriate basis, for the waiver plan to operate as described in the state's waiver application.”
Iowa therefore withdrew its waiver proposal.
Iowa has not enacted a law authorizing pursuit of a waiver but instead argues it has existing authority to do so.
[Back to 1332 State Innovation Waiver Resource Center]