On March 12, 2012, the United States Department of Health and Human Services (HHS) issued a final interim rule on Affordable Health Insurance Exchanges (Exchanges) to assist states in setting up Exchanges. The final rule combines policies from two Notices of Proposed Rulemaking issued last summer. A few notable provisions are as follows:
- The Establishment and Operation of an Exchange. The final rule outlines the standards for a state to establish an Exchange. A state may structure its Exchange in its own way (e.g., as a non-profit entity, independent public agency, etc.).
Additionally, a state may choose to operate the Exchange in partnership with other states as a regional Exchange. Exchanges will perform a variety of functions, including certifying qualified health plans, operating a website to facilitate plan comparisons, determining consumer eligibility and facilitating enrollment. States' plans must be approved by January 1, 2013, but the final rule allows for conditional approval if the state is advanced in its preparation and HHS believes the Exchange will be operational by Fall 2013, in time for enrollment in the Exchanges. The final rule also allows states that are not ready for 2014 to apply to operate the Exchange for 2015 or any subsequent year.
- Health Insurance Plans that Participate in an Exchange. Health plans offered through the Exchanges must be certified as "qualified health plans." To be certified, health plans must meet minimum standards that are primarily defined in the law. However, the final rule gives Exchanges the ability to establish additional standards for health plans offered in the Exchanges, such as the number and type of health plan choices and standards for health plans. The final rule also allows Exchanges to establish marketing standards to ensure that plans do not market in a way that discriminates against people with illnesses.
- Individual's Eligibility to Enroll in Exchange. The final rule establishes a web-based system through which an individual may apply for and receive eligibility determinations. The final rule outlines standards and processes for Exchanges to determine whether consumers are eligible for all available programs using a single application. Additionally, the final rule allows coordination with Medicaid, CHIP and the Basic Health Program, where applicable.
- Enrollment in Health Plans through Exchanges. The final rule outlines an enrollment process for eligible individuals that uses websites and toll-free call centers to help consumers enroll in coverage. Exchanges will have the option to improve the performance of this system through the design of their website and determine whether to use the single application that will be made available or design a comparable application. Additionally, the final rule provides standards for Exchanges to build partnerships with and award grants to "Navigators" who reach out to employers, employees, consumers and self-employed individuals to perform certain tasks, including public education about qualified health plans and assisting consumers in selecting qualified health plans.
- Employer Eligibility for and Participation in the Small Business Health Options Program. In 2014, Exchanges will operate a Small Business Health Options Program (SHOP) which will provide small employers with additional ways to provide health coverage. The final rule allows Exchanges to determine how a SHOP is structured. For example, the final rule provides Exchanges with the ability to determine the size of a small business that can participate in the SHOP. Until 2016, Exchanges may include businesses with one to 50 employees or one to 100 employees. Beginning in 2016, small businesses may be allowed to participate in the SHOP if they have one to 100 employees. Finally, in 2017, states have the option to let businesses with more than 100 employees purchase coverage through the SHOP. The final rule also provides for a tax credit of up to 50% of premiums for small employers purchasing coverage through a SHOP beginning in 2014 if the employer has 25 or fewer employees, pays employees an average annual wage of less than $50,000, offers all full-time employees coverage and pays at least 50% of the premiums.
REINHART COMMENT: The final rule provides limited information about the interactions between multiemployer plans and Exchanges. However, the Department of Health and Human Services (HHS) has stated its intention to address issues related to multiemployer plans in future guidance.