CMS has released proposed rules for health insurance exchanges

The Centers for Medicare and Medicaid Services (CMS) has released a proposed rule that outlines further details about the standards and systems for states’ health insurance exchanges, Medicaid and the Children’s Health Insurance Programs (CHIP) to work together to meet consumer health needs, improve quality and lower costs in 2014.
 

The proposed rule released Jan. 14 also provides options for coordinating Medicaid, CHIP, and exchange communications to consumers about eligibility notices and appeals, and additional benefits and cost-sharing flexibility for state Medicaid programs under the Patient Protection and Affordable Care Act.

The intent is “to afford states substantial discretion in the design and operation of an exchange, with greater standardization provided where directed by the statute or where there are compelling practical, efficiency or consumer protection reasons,” according to the 474-page document.
 
The theme builds on the health insurance exchange rule in March 2012 “to continue to rely on the use of information technology and data matching to minimize administrative burden on applicants, states, and plans,” CMS said.
 
State-based exchanges may also turn to the Health and Human Services Department for verification of whether an individual has employer-sponsored coverage and conducting some types of appeals, according to Health and Human Services Secretary Kathleen Sebelius. 
 
The proposed rule “gives states more flexibility to implement the law in a way that works for them,” she said in an announcement accompanying release of the proposed rule. 
 
Under the healthcare law, adults who earn up to 133 percent of poverty, or $14,865 for an individual or $30,656 for a family of four, may be eligible for Medicaid coverage. Others may shop and compare plans for coverage through a health insurance exchange, where they may also determine if they are eligible for tax credits or other affordability programs.
 
The provisions include:
 
  • Process for a coordinated exchange and Medicaid appeals of eligibility determinations. Enrollees will first be able to have a preliminary case review by appeals staff in an informal resolution. If the enrollee is satisfied, the decision stands. Enrollees dissatisfied with the outcome would have rights to a full appeal. A federally-managed appeals process would be available to enrollees in the individual market. State-based exchanges could establish their own appeals processes following the rule’s standards, with individuals retaining the right to a federal appeal after exhausting the state-based appeals process. States also may coordinate appeals of eligibility decisions across Medicaid, CHIP and the exchange.
  • Notices and communications about eligibility for insurance affordability programs will be clear and accurate. The notices of insurance affordability programs will be combined, including Medicaid, CHIP, advance payments of the premium tax credit and cost-sharing reductions, as well as eligibility to enroll in a qualified health plan through the exchange.
  • Medicaid cost sharing of premiums will be updated and simplified. Additionally, states will be allowed to establish higher cost sharing for non-preferred drugs and to impose higher cost sharing for non-emergency use of the emergency department.
  • Eligibility categories will be streamlined. The eligibility categories that will be in effect in 2014 build on the Medicaid and CHIP eligibility final rule issued in March 2012. It shifts to use of the Modified Adjusted Gross Income, or MAGI, method for determining eligibility with most populations. It also simplifies and aligns the citizenship documentation process across Medicaid, CHIP and the exchange.
The proposed rule also outlines standards for the approval of application counselors, who will play an important role in assisting individuals in applying for and maintaining coverage in a qualified health plan through the exchange and insurance affordability programs.