New DI Discussion on the Next Big Thing in ACA Implementation: State Innovation Waivers

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July 2015

New DI Discussion on the Next Big Thing in ACA Implementation: State Innovation Waivers

Section 1332 of the ACA includes provisions on Innovation Waivers, which allow states to waive some of the requirements of ACA and propose alternatives in several key areas. Shortly after Center for Consumer Information and Insurance Oversight (CCIIO) posted a new webpage specifically on the topic of 1332 waivers, NADP posted the following with background information and education. Members are encouraged to post updates from their states and ideas on how the waivers could impact dental.

New CCIIO Webpage re State Innovation Waivers
The Center for Consumer Information & Insurance Oversight (CCIIO) has published a new webpage dedicated to resources, regulations and guidance for states on ACA Section 1332 State Innovation Waivers. The webpage provides new Frequently Asked Questions (FAQs) and directions on the submission process for states considering a waiver.

With subsidies upheld in King v. Burwell, these waivers are likely the next big thing to watch in Affordable Care Act (ACA) implementation. The Exchange Policy Workgroup (EPW) has discussed early state activity in considering waivers and some of that tracking is included in the background below.

Please use this Dental Interact (DI) thread to post news items and updates as you see them. Are there other states you’ve heard of that are considering applying for a waiver? For what purpose? How are the discussions going? How will children’s dental coverage be impacted?

Background
Section 1332 of the ACA includes provisions on Innovation Waivers, which allow states to waive some of the requirements of ACA and propose alternatives in several key areas:

The individual mandate/penalty
The employer mandate/penalty
Standards for a basic health insurance policy
Establishment of an Exchange
How federal subsidies reduce premiums and copays

If granted, states with innovation waivers can collect all the federal dollars that would be used for premium subsidies, cost-sharing reductions (CSRs) and small business tax credits to finance health coverage according to the new state law.

As noted by Health Affairs, the waivers “don’t exempt states from accomplishing the aims of the ACA, but give them the ability (and responsibility) to fulfill the aims in a different manner while staying between certain guardrails.” In order to receive the waiver, state law must ensure that:

Individuals receive insurance coverage that is at least as comprehensive as ACA coverage;
The coverage is as affordable as it would be under ACA;
As many people would be covered as with the ACA; and
The state program does not increase the federal deficit.

State Innovation Waivers cannot take effect before Jan. 1, 2017; however, applications can be submitted prior to that date.

Before submission, states are required to provide public notice, comment period and public hearings to ensure a meaningful level of public input. After submission, Health and Human Services (HHS) and Treasury will conduct a preliminary review to determine whether the application is complete within 45 days after submission. The application will then be made public for a federal comment period, and a final decision will be issued no later than 180 days after the preliminary determination of a complete application.

While it may be the case that states have the authority under state law to develop and submit waivers, some will need or want to establish this authority in legislation and/or organize a task force to develop a waiver plan.

The following is a list of some state bills we’ve seen this legislative session that touch on 1332 waivers.

State/Bill No.	Description or Status	Links
AR	A section 1115 waiver that allows the state to place Medicaid expansion enrollees on the Exchange expires December 2016. A combined waiver that addresses this as well as Exchange, CHIP and Medicare programs could be considered. A task force has been established to consider the options and an RFP developed for consulting.	Public Consulting Group 4/6/15 report for the Arkansas Health Insurance Marketplace: http://bit.ly/1SEzAw7
CA SB 4 (Passed Senate; in House Appropriations)	Requires the state to apply for a 1332 waiver that would allow undocumented immigrants to purchase coverage on the Exchange.	CA SB 4: http://bit.ly/1g8geE6
CO	The Connect for Health Colorado legislative oversight committee formed a working group to consider innovation waivers.	Manatt Health Solutions 6/16/15 presentation to the Policy & Regs Committee: http://bit.ly/1MnuCUO
HI HB 576 HI SB 1341 (enacted and effective 7/1/2015)	Amends 2014 legislation passed regarding the State Innovation Waiver Task Force to narrow the scope of the Task Force. Meetings began in the fall of 2014.	HI State Innovation Waiver Task Force webpage: http://1.usa.gov/1ejz09u HI SB 1341: http://1.usa.gov/1yJ32rp
-MN SB 1458 (enacted omnibus health budget) -MN SB 390 (HB 5 companion passed Committee in March)	Some articles have indicated that MN would like to use a waiver to build on the state’s Basic Health Plan to smooth out the coverage continuum for low-income residents. SB 1458 establishes a task force on health care financing, which will consider opportunities including 1332 and 1115 waivers. SB 390 may allude to a 1332 waiver in Section 1.	MN SB 1458: http://bit.ly/1HV3HdN MN SB 390: http://bit.ly/16phq0b
NM SJM 2 (died upon adjournment)	This is a Joint Memorial for the superintendent of insurance to convene an innovation waiver working group to make recommendations to the governor and the legislature on the value of applying for an innovation waiver.	NM SJM 2: http://bit.ly/18Ord1h
OH HB 64	Biennial budget bill includes language that requires the DOI to apply for a federal waiver. The language also requires the Superintendent of Insurance to include in the application a request for waivers of the federal employer and individual mandates established by the ACA.	OH HB 64 (page 1506): http://bit.ly/1DLTpeb
RI State Budget	Authorizes the state to pursue a waiver.	Budget document: http://bit.ly/1JhgSdo
SC HB 3020 (no movement since introduction)	HB 3020 would prohibit state agencies or officers from enforcing ACA or establishing an Exchange. The bill notes that state agencies are not prohibited from applying for or developing state innovation waivers.	SC HB 3020: http://bit.ly/1BVbBAg
VT HB 88 (no movement since introduction)	Vermont signaled its intent to apply for a waiver back in 2012. HB 88 would create a public health coverage option, called Vermont Care, to be offered through the Exchange. A subsection would direct the state Secretary of Human Services to apply for a State Innovation waiver to effectuate Vermont Care, including waiving the employer responsibility requirement and the requirement that carriers on the Exchange offer at least a silver- and a gold-level product.	VT HB 88: http://bit.ly/1zgx6OJ

For more information, review the CCIIO website and related resources online here. Also, NADP hosted a webinar with Cindy Gillespie, Principal in Dentons’ Public Policy and Regulation practice, on 1332 State Innovation Waivers—a recording is available for purchase online here.