|Approval Dependent on Certain ConditionsThe Centers for Medicare and Medicaid Services (CMS) has conditionally approved applications from Delaware and Pennsylvania to create state-based Health Insurance Marketplaces.Background
Exchanges (also known as Health Insurance Marketplaces) provide an option for individuals to buy private health insurance. The Exchanges also operate the Small Business Health Options Program (SHOP) as an option for qualified small employers to purchase employee health coverage. The U.S. Department of Health and Human Services (HHS) has issued final rules relating to Exchanges which include standards for their establishment and operation (among other things).
The federal government operates “federally-facilitated Exchanges” in states that did not elect to establish their own state-based Exchange, while some states operate a hybrid state partnership Exchange in which the state runs certain functions.
The U.S. Supreme Court will soon decide whether the Affordable Care Act’s premium tax credits are limited under the law only to individuals who enroll in qualified health plans through state-based Health Insurance Marketplaces (Exchanges). The decision will resolve conflicting July 2014 court rulings in the District of Columbia Circuit Court of Appeals, which limited the credit to individuals enrolled in state-based Marketplaces, and the Fourth Circuit Court of Appeals, which upheld IRS rules that also include individuals enrolled in federally-facilitated Marketplaces.
Note: The IRS subsequently clarified that following those rulings, nothing changed regarding the tax credits and the credits remain available whether individuals are enrolled in coverage through a federally-facilitated or state-based Marketplace.
Conditional Approval for Delaware and Pennsylvania State-Based Marketplaces
Recently, Delaware announced its intention to pursue a transition from a state partnership Marketplace to a state-based Marketplace that is expected to provide a choice of coverage for consumers and small businesses in 2016. Additionally, Pennsylvania recently issued a declaration to implement a state-based Individual and SHOP Marketplace for plan year 2016.
CMS has granted Delaware and Pennsylvania conditional approval to establish state-based Marketplaces. CMS’ decision is contingent on the following conditions:
- Timely demonstration of the ability to perform required Marketplace activities in line with the attestations Delaware and Pennsylvania have made in their Marketplace Blueprint Application submissions; and
- Compliance with federal regulations and completion of expected progress benchmarks.
CMS is expected to send progress assessment letters to the Choose Health Delaware’s and Pennsylvania Marketplace’s leadership teams.
Stay tuned as we bring you more regarding the implementation of Delaware’s and Pennsylvania’s state-based Marketplaces.
For more information contact your Total Benefit Solutions account manager at (215)355-2121.