Federally Facilitated Exchanges — Getting States to Help Out
The fog has cleared. CMS sees the size of the FFE Mountain and is beginning to put its plans in place to get health plans certified to participate in the FFE by August 2013. While the partnership states have clearly indicated their intention to play a role in reviewing federal requirements for FFE applicants, other states’ governors have cited a myriad of reasons for not having an exchange. At this point, CMS has a few issues to sort through before they can give directions to applicants.
Each state must communicate to CMS their level of cooperation in conducting reviews of applications and oversight of health plans in the FFE. All of this activity must be accomplished at warp speed to make sure that everyone is on the same page in terms of their roles and responsibilities in getting plans on the FFE.
For the seven partnership states, the decision is clear. Each state has provided information in their blueprint application about areas they will oversee. While this is a major step, CMS and each partnership state will need to mutually agree how state requirements comport with FFE requirements. Where they do not, states must understand federal criteria and conduct reviews accordingly in the application process. An MOU will certify the process in each state.
Currently, twenty-four other states that have chosen not to partner with CMS will follow different routes as the FFE becomes operational. CMS extended the timeline to February 15 to encourage more of these states to become a partnership state. To give them an idea of what partnership means, CMS published descriptions of the roles the states can play in a partnership.
At the same time, CMS has made numerous entreaties to these states about roles that they can play in the FFE oversight process (see pp14-16). Consequently, CMS must plumb each non-partner state to determine their interest. This means that leadership in the state regulatory agencies must determine the degree to which they should become a cog in the federal regulatory system.
For some, providing no support is fundamental political theater that demonstrates state independence and requires the federal government to incur full costs along with responsibility for failure. Notably, any of these passive states can still receive payments to provide licensure and solvency as well as any other information that will assist the FFE.
For FFE states willing to coordinate, the CMS task is to evaluate state requirements to determine equivalency to FFE requirements and agree on methods for oversight with each state in whatever limited number of areas equivalency can be established, as well as how information can be continuously shared to support FFE oversight activities.
The dance steps needed for mating state regulatory structures with the federal government in each of the 24 non-partner states are substantial. Getting state/federal agreement to mutually oversee health plans in any limited area requires bureaucratic grease, especially in a compacted timeline. To work with states and make the path as clear and uncomplicated as possible, CMS is making a framework to do this with added definitions and analytic tools. The goal: to be ready in three months for the first applicants.
Notwithstanding resolving equivalency of requirements in states that wish to hold off federal takeover in even a small way, the mating process will also bog down in negotiations around added resources, costs incurred and payment for state services. CMS needs to ensure that these issues do not become obstacles that upend the August 2013 timeline. CMS will need to re-consider using any state’s regulatory structure when it becomes clear this engagement process has overwhelmed the goal in that state.
Resources:
Download Jean LeMasurier’s whitepaper on Insurance Exchanges in the ACA.
Read Steve Balcerzak’s previous blog post on the FFE draft application for qualified health plans.