CMS to You: How Should the ACA System Change?

Computer graphic illustration about internet shopping in virtual world.

The Centers for Medicare and Medicaid Services (CMS) is asking for ideas that could create a middle way forward on how the U.S. commercial health insurance market works.

Many conservative Republicans in Congress still want to repeal the entire Affordable Care Act (ACA) health system framework, and a court ruling on the Texas v. USA case or another court case could help make that happen.

The ACA is a two-law statutory package that includes the Patient Protection and Affordable Care Act of 2010 (PPACA) and the Health Care and Education Reconciliation Act of 2010 (HCERA).

Many Democrats are promoting Medicare for All proposals that could create a single-payer, federally run health finance system, or at least a major new Medicare buy-in program.

CMS has now posted two documents that could shape what the commercial health insurance market looks like if most or all of the current ACA framework stays in place:

One is a formal request for comments on how states could use the new CMS ACA rule waiver guidelines, which were completed in October.

The State Relief and Empower Waiver (SREW) program, which was created by PPACA Section 1332, could give states more ability to change ACA programs and rules, without Congress changing any provisions in the ACA.

Officials at CMS and its parent, the U.S. Department of Human Health and Services, believe that HHS has the ability to make some policy tweaks, within the ACA medical underwriting and benefits standards "guardrails," but adjusting the requirements in ways that could increase access to coverage.

The other new document is a set of new guidelines that states can use to create their own, entirely state-based ACA exchange programs, or state-based ACA exchange programs that use the federal government's own HealthCare.gov system to handle some of the work.

States that want to apply for SREW program ACA rule waivers might want to consider setting up their own state-based exchange programs, or SBE programs, rather than relying on HealthCare.gov to provide exchange services, CMS officials say in the new state-based exchange creation guidelines.

"Some waiver options may be easier to implement for states with SBEs," officials say in the new exchange creation guidelines. "In addition, a state could seek waivers that would allow the functions and offerings of the Exchange in the state to be tailored to the state's waiver plan as many requirements applicable to Exchange functions and activities are waivable under Section 1332."

CMS officials describe the ACA waiver program as a programs that allows "a state to implement innovative ways to provide access to quality health care so long as coverage under the waiver is at least as comprehensive and affordable as would be provided under the PPACA absent the waiver, coverage is provided to a comparable number of residents of the state as would be provided absent a waiver, and the waiver does not increase the Federal deficit."

CMS officials note that they have already put the exchange creation document through two comment periods and are not putting that document through a new comment period now.

The SREW request for information, which is set to appear in the Federal Register Friday, will have a comment period. The deadline will be 60 days after the official Federal Register publication date.

HHS and the U.S. Treasury Department, which also plays a role in administering the ACA, "are interested in waiver ideas for states to consider that will strengthen their health insurance markets, expand choices of coverage, target public resources to those most in need, and meet the unique circumstances of each state," according to the request for comments. "The Departments are soliciting comments on waiver concepts that states could potentially use alone or in combination with other waiver concepts, state proposals, or policy changes."

In the past, under former President Barack Obama, HHS interpreted a number of ACA provisions in ways that made the provisions easier for HHS and health insurers to implement.

The ACA, for example, requires a mid-level, or silver-level, health plan to cover 70% of the actuarial value of a standard benefits package. During the Obama administration, HHS decided that a plan covering "70% of the actuarial value" of the standard benefits package could actually cover about 68% to 72% of the actuarial value of the standard benefits package.