Over the past year, states have juggled a litany of changes coming from the federal government relating to the Affordable Care Act (ACA). In the last few months alone, those watching the ACA marketplaces have witnessed repeated attempts to repeal or replace the law, questionable enforcement of the individual mandate, cuts to outreach and enrollment funding, and most recently, the decision to halt cost-sharing reduction (CSR) reimbursements to health plans. These efforts to undermine the law at the federal level have created a range of problems for states who are left holding the bag. Regardless of political persuasion, insurance officials struggled to set 2018 rates due to indecision on CSR payments; they were on the hook for preserving consumers’ coverage options as ambiguity drove insurers out; and they had to walk a tight line between holding premiums down and ensuring rates are sufficient to prevent insurer insolvencies.
As the national debate unfolded, states spoke up. Insurance commissioners expressed concern with ACA replacement proposals, others requested hearings to prepare for open enrollment, and some asked for flexibility via the 1332 waiver process. States have been vocal in providing recommendations for how to maintain a stable market.
Now, a few states are beginning to take matters into their own hands. Recent action in two of them, Nevada and Washington, demonstrate state officials’ interest in preserving the improvements in their uninsured rates and keeping their insurance markets functioning, in spite of what’s happening at the federal level.
Nevada Begins Its State-Based Marketplace Blueprint Application
On October 12, Nevada’s marketplace reported that it has begun work on a state-based marketplace blueprint application that would allow it to transition off of HealthCare.gov and onto its own eligibility and enrollment technology platform. Nevada is currently considered a “state-based marketplace on the federal platform” (SBM-FP), which means that it maintains many state-based operational functions, but relies on federal technology to process enrollments. As part of this arrangement, the state pays a leasing fee to use HealthCare.gov. For 2018, Nevada estimates it will spend $7.2 million dollars to use the platform, which is $5.5 million more than it anticipates spending in 2017. And yet, based on recent changes to HealthCare.gov, it will be receiving far fewer services.
First, the open enrollment period has been reduced from 90 to 45 days. Second, the Centers for Medicare and Medicaid Services (CMS) recently announced that HealthCare.gov will shut down for maintenance the first night of 2018 open enrollment, as well as 12-hour periods nearly every Sunday throughout the open enrollment season. Nevada calculates that the shutdowns account for nearly 42 percent of all possible Sunday enrollment hours, compared to 30 percent of Sunday hours spent on maintenance last year.
Not only will it be spending more for fewer services, but the state’s attempts to coordinate with CMS have been largely unsuccessful. For example, Nevada reports that is has requested documentation from CMS on several occasions to ensure that the HealthCare.gov can support users during the compressed timeframe, and that requests “have not been satisfactorily addressed.” The state also inquired about potential remedies in the event that HealthCare.gov encounters any malfunctions this year, and says that “questions have gone unanswered.” For all these reasons, Nevada is taking its first step in transitioning away from federal control and to its “own technology with sustainable cost structures and regular access to consumer information.” It’s unknown how long this process could take and whether their application will ultimately be supported, but it’s fair to say that a state-based approach could give them greater autonomy and certainty in a period of federal doubt.
Washington Considers A “Technical Fix” to Enabling Statutes
On October 10, Washington’s state-based marketplace considered potential changes to its enabling statutes, which would remove and replace all ACA references with amendments authorizing independent state authority. For example, instead of stating that “the exchange will operate consistent with the Affordable Care Act,” the state would specify its own plan certification, marketing, and enrollment standards. The exchange noted that such changes could help “protect the gains” made under the ACA, in light of federal uncertainty and a new administration.
While the “technical fix” has only just been proposed, it could be a sign of things to come as states look to preserve progress made in the last four years, and protect against any federal threat to chip away at their success.
It’s been a bumpy year for states as they worked to regulate their local insurance markets, while adjusting to an Administration that opposes the current framework. That opposition has created a variety of problems for states across the political spectrum, and now, some are starting to reassert their authority over their insurance markets in order to preserve gains achieved. These early signs suggest that if states can’t turn to the federal government for support, some are willing and ready to go at it alone.