The American Rescue Plan (ARP) took big steps to improve the affordability of health insurance for individuals relying on the Affordable Care Act’s (ACA) marketplaces. The federal law enacted earlier this year expanded premium assistance and access to cost-sharing reductions for marketplace enrollees in 2021 and 2022, resulting in record enrollment and significant savings for consumers this year. To realize these gains, the ACA’s marketplaces underwent technological and operational updates so that consumers could access the new savings, making health insurance more affordable for millions. In addition to the federal marketplace implementing the ARP on HealthCare.gov, state-based marketplaces (SBM) played a key role in making the more generous subsidies available.

Last month, the Centers for Medicare & Medicaid Services (CMS) announced $20 million in grant funding for the 21 SBMs. The federal funding, allocated under the ARP, will allow SBMs to modernize their technology platforms, outreach programs, and other systems and operations to ensure compliance with federal requirements, including the ARP’s temporary subsidy expansion. Here’s a look at some of the things SBMs are planning to do with the new grant funding:

Investing in More Equitable Consumer Outreach and Education

Unsurprisingly, given their history of commitment to outreach, SBMs also plan to put grant funds towards efforts to broadcast the availability of marketplace plans and expanded financial assistance under the ARP. Almost every grantee will fund initiatives to educate consumers, conduct robust outreach, or train and prepare consumer assisters on changes to subsidy eligibility and increased enrollment volume. Several of these outreach campaigns have a health equity component, targeting historically uninsured and underinsured populations; New Mexico’s marketplace will bolster its outreach to Native American communities, while Vermont plans to provide “mini-grants” to organizations that serve young adults, communities of color residents, workers in particularly hard-hit industries during the pandemic, and other vulnerable populations. The New York marketplace expects to develop resources in 26 languages, and Massachusetts also plans to provide educational materials in a variety of languages. Arkansas’s marketplace will produce creative content to engage rural and multicultural communities, while California’s marketplace will design its consumer education campaign to reach the state’s ethnically diverse residents. Virginia plans to focus outreach efforts in areas of the state with higher uninsured rates and Kentucky has identified target populations for consumer education that include people who were denied Medicaid and unemployment recipients.

Transitioning to a Full State-Based Marketplace

Grants will also support three states as they transition away from HealthCare.gov to a state-operated marketplace platform this fall. New Mexico’s marketplace plans to align modernization efforts with its SBM establishment, while Kentucky will put grant funds towards compliance with federal requirements in connection with its transition to a full SBM. Maine’s funding will go towards designing and implementing improvements to carrier enrollment reconciliation activities, a new responsibility it takes on as a full SBM.

Preparing for End of the Public Health Emergency

During the COVID-19 pandemic, states are prohibited from disenrolling Medicaid beneficiaries when their eligibility changes, absent the enrollee’s request, as a condition of the federal government paying for a greater share of Medicaid costs. When the ongoing Public Health Emergency (PHE) declared in response to the pandemic ends—a conclusion expected sometime after 2021—millions of people will be redetermined as ineligible for Medicaid, and estimates suggest that a third of adults that lose Medicaid will qualify for subsidized marketplace plans under the current ARP subsidy expansion.

SBMs are using some of their grant funds to prepare for the end of the PHE and subsequent Medicaid redeterminations and marketplace enrollment. Virginia plans to conduct a market analysis to better understand the impending end of the PHE and mass exodus of Medicaid enrollees to the marketplace, including the projected impact on individual market premiums. Some SBMs, including Virginia and Washington State, will fund outreach efforts that target consumers who will be impacted by the end of the PHE. Maryland’s marketplace plans to fund stakeholder training programs that address the end of continuous Medicaid coverage during the PHE, while New Mexico’s marketplace will prepare its call center to assist residents that are transitioning off of Medicaid and onto the marketplace.

Updating Marketplace Technology

Most SBMs will allocate some of their funding to technology updates. A primary focus of these updates stems from the ARP’s changes to federal subsidies that reduce consumers’ premium and cost-sharing burdens. To implement the expanded subsidies, SBMs had to update their eligibility and enrollment platforms to reflect temporary changes to subsidy structure and availability, such as removing the cap that previously prevented enrollees with household incomes above 400 percent of the federal poverty level from accessing premium subsidies. While SBMs have already implemented these changes, many grant proposals described using the federal funding to cover the costs of system updates. For example, the New Jersey marketplace will put grant funds towards automatic updates the exchange performed that increased existing enrollees’ premium subsidies pursuant to the ARP’s subsidy expansion. The Washington State marketplace, noting technical difficulties with ARP implementation, plans to improve the capacity of its marketplace technology for both ARP-related updates and other ongoing system needs.

In addition to funding ARP implementation, grants will go towards efforts to improve marketplace eligibility and enrollment platforms as well as other online resources. Colorado’s marketplace plans to replace its “legacy” technology with a more current system. Some SBMs, such as Rhode Island’s marketplace, will improve self-service functioning of their marketplace website, while the marketplace for the District of Columbia (D.C.) proposed funding updates to account transfers between Medicaid and the marketplace. Idaho’s marketplace will improve the experience for consumers who sign up during a special enrollment period (SEP), and Oregon’s marketplace, a SBM on the federal platform, will improve consumer search tools offered on its state website.

Improving Call Center Capacity and Competence

Several SBMs hope to use grant funds to improve their marketplace call centers. Some SBMs, including D.C., Pennsylvania, and Nevada, plan to invest in greater call center capacity to handle the increase in volume prompted by the availability of expanded subsidies under the ARP. New Mexico’s marketplace will modernize its call center in part to support ARP assistance. New Jersey’s marketplace, which also plans to increase its call center capacity, will invest in more support for the processing and resolution of data-matching issues (DMI) as well as getting call center representatives up to speed on the impact of the ARP. Oregon’s marketplace also plans to develop new training materials related to the ARP for call center staff.

Takeaway

The ARP’s subsidy expansions imposed new demands on state systems during a pandemic that already placed a heavy burden on SBMs. After achieving substantial—and even record—enrollment through their initiatives to connect consumers to marketplace plans, new grant funding will allow SBMs to build on their progress. As states prepare for the end of the PHE and address the ongoing hardships brought by the pandemic, investing in more equitable outreach and consumer assistance, and improved eligibility and enrollment systems will ensure that SBMs can continue to provide access to affordable, quality coverage.