Last month, we reported that Idaho announced a controversial plan to allow insurers to sell policies that do not comply with certain ACA requirements — a move that some feared would set a precedent for other states. The Centers for Medicare & Medicaid Services (CMS) initially remained silent on the legality of Idaho’s plan, not wanting to offer “premature” opinions on the matter. CMS broke its silence last week and (somewhat reluctantly) gave Idaho’s plan the red light. Although CMS said Idaho’s current plan is a no-go, it also provided guidance on how Idaho might modify its plan and still remain within the bounds of the law.
On March 8, CMS released a letter to Idaho’s governor and insurance director, explaining that while it appreciated Idaho’s “dedication to the people of Idaho and [its] efforts to address the damage caused by the PPACA,” CMS had a duty to enforce and uphold the law. CMS further explained that when it has reason to believe that a state is not substantially enforcing the provisions of the ACA, it has the responsibility to enforce the law on behalf of the state, but noted “[t]his is certainly not our preference; we believe that Idaho has options within the law to meaningfully implement many of the policy proposals contained in the Bulletin, to address the crisis facing the state’s individual health insurance market.”
CMS said that Idaho had 30 days to respond to its letter. CMS also went a step further and outlined a path for Idaho to still allow its state-based plans within the bounds of the law. It explained that, on February 21, 2018, HHS proposed a rule that would expand the availability of short-term, limited duration health insurance, by allowing consumers to buy these plans for any period less than 12 months, rather than the current maximum period of less than three months. CMS said, “[n]otwithstanding our concerns regarding the Bulletin, . . we believe that, with certain modifications, these state-based plans could be legally offered under the PHS Act exception for short-term, limited duration plans. I encourage you to continue to engage in a dialogue with my staff regarding this and other potential options.”
While many ACA supporters view CMS’ response as a victory in upholding the ACA, Idaho officials do not seem dissuaded. In a press release issued on March 9, the governor’s office stated:
Contrary to news media interpretations, the letter from CMS Administrator Verma was not a rejection of our approach to providing more affordable health insurance options for the people of Idaho. Her letter made it clear that Idaho’s efforts to pursue innovative alternatives hold great promise, and we believe that Idaho’s plan aligns with the State’s responsibility for “substantially enforcing” Obamacare. In fact, we consider the letter an invitation from CMS to continue discussing the specifics of what can and cannot be included in state-based plans. We will consider all possible options and then continue discussions with CMS and HHS on how best to achieve our shared goals of reducing the costs of coverage and stabilizing our health insurance market.
In stopping Idaho’s current plan, CMS may very well have given other states the green light to adopt more creative ways to skirt the requirements of the ACA.