ACA Now

Implementation Status

2012

A February 24, 2012, CCIIO bulletin on cost-sharing reductions and actuarial value solicited comments on – as well as presented – the agency’s planned regulatory approach on implementing these provisions.

The March 27, 2012, Exchange establishment final rule lays out eligibility parameters for cost-sharing reductions.

On December 28, 2012, the GAO released a report examining the expiration of the Health Coverage Tax Credit (HCTC), and specifically, how the implementation of the ACA premium tax credits, cost-sharing subsidies and Medicaid expansion will affect HCTC participants’ costs for health plans in multiple ways.

2013

HHS’s March 11, 2013, final rule on – the Notice of Benefit and Payment Parameters for 2014 – establishes several standards governing the cost-sharing reduction program.

On April 12, 2013, CMS issued an information collection regarding processes whereby QHPs would report to HHS on the reconciliation reporting option – pertaining to advance payments of cost-sharing reductions they have received from the agency – that they have selected for a benefit year.

On May 14, CCIIO released FAQs on Health Insurance Marketplaces addressing issues involving: (1) CMS oversight of state-operated premium stabilization programs, advance payments of the premium tax credit and cost-sharing reductions; (2) issuer oversight in Federally Facilitated Marketplaces; (3) State-Based Marketplace reporting requirements; (4) privacy and security standards for State-Based Marketplaces and consumer assistance personnel; (5) cost-sharing reductions and health savings accounts; (6) eligibility and enrollment – specifically, CMS’s intent to “propose rulemaking and supplemental guidance on the use of [Health Plan Identifiers] in enrollment and payment transactions between issuers and the Federally Facilitated Marketplace”; and (7) issuer withdrawal from the small group or large group market.

On June 28, the IRS released a notice of proposed rulemaking regarding the information that Exchanges are required to report to the IRS regarding health insurance premium tax credits, among other specified details. The proposed rule provides more specific rules on reporting of information – which, the IRS notes, helps enable such functions as the reconciliation of the premium tax credit with advance credit payments. Comments are due on or around August 28, 2013.

Via a June 28 Federal Register Notice pursuant to Paperwork Reduction Act procedures, CMS published a new information collection request (and request for a new OMB control number) under which Qualified Health Plan issuers would report on the option they have selected for reconciliation of HHS’s advanced payments of cost-sharing reductions. CMS noted it had not received any comments on the information collection requirements in a 60-day comment period that began April 12.

On July 5, CMS issued a final rule with wide-ranging eligibility provisions, including several regarding Exchanges’ eligibility and enrollment. Specifically, before January 1, 2015, State-based Exchanges may “accept the applicant’s attestation regarding enrollment in an eligible employer-sponsored plan and eligibility for qualifying coverage in an eligible employer sponsored plan for the benefit year for which coverage is requested without further verification.” For income verification, for the first year of operations, rule note that CMS is “providing Exchanges with temporarily expanded discretion to accept an attestation of projected annual household income without further verification” applicable to individuals who are not part of a statistically-significant sampling strategy that is delineated in the rule. Other provisions address, among others, authorized representatives, enrollment-related transactions, special enrollment periods and terminations. Also see a July 8 Paperwork Reduction Act package related to information collection under the Exchange-related provisions of this rule.

On September 24, CMS sent the CY 2015 Notice of Benefit and Payment Parameters proposed rule to OMB for review, noting the “proposed and subsequent final rule must precede plan approval and open enrollment (must be complete by January 1, 2014).” The proposed rule is anticipated sometime in October.

On September 10, Sen. Orrin Hatch (R-UT), Ranking Member of the Senate Finance Committee, and Rep. Dave Camp (R-MI), Chairman of the House Ways & Means Committee, wrote to Treasury Secretary Jacob Lew opposing any regulatory action to extend premium tax credits and cost-sharing reductions to workers in multi-employer plans. On September 13, in a letter to Rep. Camp, Secretary Lew wrote, “the conclusion that an individual cannot benefit from both the exclusion from taxable income for employer-provided health coverage under such a plan and the premium tax credit provided by the ACA applies whether the individual is covered by a single-employer plan or a multiemployer plan.” On September 18, in a letter to Office of Management and Budget Director Sylvia Burwell, 21 Republicans said they are “troubled that the administration has only made a commitment to not move forward with a rule through the IRS, but has left the door open for the Department of Labor (DOL) to issue a regulation favoring labor unions.”

On Nov. 4, CCIIO posted slides explaining the process – and specific information – required for enabling monthly cost-sharing reduction and advance premium tax credit payments to health insurers. On Nov. 6, House Ways and Means Committee Chairman Dave Camp (R-MI) asked the IRS to supply data on subsidy eligibility determinations conducted for Marketplace applicants, including the average age of those applying.

On Nov. 12, CMS posted a chart generally characterizing, based on income, whether consumers may be eligible for premium tax credits, cost-sharing reductions or Medicaid.

Also on Nov. 12, CMS posted the authorization form through which QHP issuers verify that CMS may make deposits or adjustments in transmitting premium subsidy and cost-sharing reduction payments. Also see a Financial Information Template, Bank Verification Letter Instructions and Payee and Banking Information Submission Instructions. In an e-mail, the agency notes that issuers should e-mail the template and authorization agreement to vendor_management@cms.hhs.gov, while faxing decryption codes and bank verification letters to 301-492-4746 by Dec. 1, 2013.

On Nov. 25, HHS issued a proposed rule establishing the CY 2015 benefit and payment parameters for the cost-sharing reductions (including the annual limitation on cost-sharing for stand-alone dental plans), advance premium tax credit, reinsurance, and risk adjustment programs as required by the ACA.  In addition, the proposed rule establishes the user fees for the Federally-facilitated Exchanges (FFEs), the annual open enrollment period for 2015, the actuarial value (AV) calculator, and other key provisions as required by the law.  Note that the rule allows for adjustments to the risk corridors and other premium stabilization programs in 2014 to account for the “transitional policy” (see the Nov. 14 CCIIO letter to Insurance Commissioners) that addressed plan cancellations, which could equate to broader risk corridors and thus higher stabilization payments to plans. Comments are due by Dec. 26, 2013.

On Dec. 13, noting the potential for mid-year changes to IT systems or mergers or acquisitions, CCIIO issued guidance indicating that “we will permit a QHP issuer to select the simplified methodology [for reconciling cost-sharing reductions] prior to the start of the 2014 benefit year, and then change their selection to the standard methodology no later than July 15, 2014, by emailing CSRreview@cms.hhs.gov.”

On Dec. 31, 2013 in a report required by the October 2013 budget deal and reflecting compliance with ACA requirements, Secretary Sebelius certified that Marketplaces verify applicants’ eligibility for advance payments of premium tax credits and cost-sharing reductions. The report examines State-Based and Federal Marketplaces’ approaches to verifying specific data elements that range from residency to household income and family size, among others.

2014

On Jan. 15, 2014 U.S. District Judge Paul Friedman, in denying the plaintiffs’ motion for summary judgment and granting summary judgment to defendant HHS, ruled that the statute “must be read as allowing the IRS to deliver tax credits to individuals purchasing health insurance on federally-facilitated Exchanges”;

In mid-January 2014, CMS began paying, via an interim payment process (see Jan. 13 slides providing an overview), advance payments of the premium tax credit and cost-sharing reductions to Qualified Health Plans, net of Federally Facilitated user fees, if applicable.

On Jan. 21, 2014 HHS released its Annual Update to Poverty Guidelines that will apply to premium subsidy eligibility in 2015.

On Jan. 30, 2014 HHS published a proposed extension to an already approved information collection (see #1, “Payment Collection Operations Contingency Plan”)  enabling it to obtain issuers’ manually entered, Excel-based payment and enrollment data used to make premium subsidy and cost-sharing reduction payments on an interim basis. The agency indicated HHS will use the information collected to make payments and collect charges in January 2014 and for a number of months thereafter, as may be required based on HHS’ operational progress.” Comments are due on or around March 30.

On Feb. 24, HHS sent the final CY 2015 Notice of Benefit and Payment Parameters rule to OMB for review, the final step before issuance of the regulation. It addresses ’15 parameters for ACA premium stabilization programs, as well as advance premium tax credits and cost-sharing reductions.

On March 7, CMS released a primer, “Report Life Changes to the Marketplace After You Enroll in Coverage,” that addresses factors ranging from marriage and divorce to income-related fluctuations, noting that while some changes can affect eligibility for Special Enrollment Periods, others may affect premium tax credit amounts, among other impacts.

On March 24, CMS posted slides presenting the April 2014 timeline for making advance premium subsidy and cost-sharing reduction payments (see slide 7).

On April 11, CCIIO released a document outlining the timeline for enrollment data submission and advance premium tax credit and cost-sharing reduction payments to Qualified Health Plans for May through September 2014.

In a May 9, 2014 FAQ, CCIIO addresses the specific documentation that QHPs must keep when providing cost-sharing reductions for contract health services under an Indian Health Service referral.

On May 23, 2014 in an updated timeline, CMS outlines Marketplace QHPs’ enrollment and payment data submission and receipt of Treasury payments of advance premium subsidies and cost-sharing reductions between May and September 2014. On May 21, saying HHS lacks income verification procedures in Federal Marketplaces, House Ways and Means Committee Republicans asked the Treasury to stop paying advance premium subsidies to insurers and requested an estimate of amounts that will be subject to recapture via tax returns.

On June 26, 2014, CCIIO released a proposed rule and guidance specifying the avenue for Federally Facilitated Marketplace (FFM) enrollees to remain auto-enrolled in the same plan for the 2015 open enrollment period, with Marketplace notices enabling them to, among other things, “update their information to get a tailored and updated tax credit that keeps up with any income changes.”  State-Based Marketplaces (SBMs) would have the ability to use the approach that FFMs intend to use (elaborated in further in the procedural guidance); existing regulatory procedures for annual redeterminations; or “alternative procedures approved by [HHS]” under specified criteria on which comment is sought. Comments are due by July 28, 2014. In tandem, CCIIO issued draft standard notices for health insurance issuers to use when discontinuing or renewing a product in the small group or individual market (see here) and instructions for using the draft notices (see here). On June 4, amid reports that 2 million Federal Marketplace enrollees have data “inconsistencies” associated with their enrollment, HHS said it is asking consumers to submit additional documentation to substantiate income, citizenship and other aspects underlying Marketplace and subsidy eligibility if reported data did not match existing sources. The agency indicated that it is offering some flexibility beyond the standard 90-day window to provide the information.

On June 27, 2014, HHS posted a Paperwork Reduction Act package containing the Cost Sharing Reduction Data Reconciliation Data Template and supporting statement contextualizing the information collection.

On Sept. 8, the IRS released a video on its YouTube page of the agency commissioner discussing premium tax credits and reconciliation, including reporting changes in circumstances.

On Sept. 10, the House Ways and Means Health Subcommittee held a hearing with officials at CMS and the IRS on the status of ACA implementation. Issues focused largely on the upcoming open enrollment period, beginning Nov. 15. During the deliberations, lawmakers expressed concerns regarding the anticipated difficulty of reconciling premium subsidies on tax returns, as well as questioned Exchange functionality for the upcoming open enrollment period.

On Oct. 6, CCIIO released FAQs saying that for the 2014 plan year, QHP issuers have an April 30, 2015, deadline for submitting cost-sharing reduction reconciliation data to HHS. Also see here on the REGTAP site (account required) indicating that issuers have until Dec. 15, 2014, to notify HHS whether they will use the standard or transitional simplified methodology for cost-sharing reduction reconciliation.

On Oct. 8, CBO estimated ACA premium subsidies and cost-sharing reductions cost $13 billion in FY14, below the $19 billion forecast in March 2010.

On Oct. 21, in a final step before formal publication in the Federal Register, CCIIO sent the proposed rule on “CY 2016 payment parameters for the cost-sharing reductions, advance payments of the premium tax credit, reinsurance, and risk adjustment programs as required by the Affordable Care Act” to OMB for final approval.

On Oct. 23, the Treasury Inspector General for Tax Administration (TIGTA) issued a report identifying gaps in IRS-to-Marketplace data security and recommending that the IRS review independent security assessments and authorizations prior to disclosing data. Also see a TIGTA press release.

On Nov. 21, House Republicans filed a lawsuit challenging the Administration’s delay of the ACA employer mandate and making of cost-sharing reduction payments, saying the latter lack congressional appropriation.

On Dec. 12, CCIIO extended the deadline for insurers to March 31, 2015 (from Dec. 15, 2014) for QHPs to select whether they will use the standard or simplified methodology for cost-sharing reduction reconciliation. On Dec. 9, CMS posted a Paperwork Reduction Act package in which it outlines information collection needs for cost-sharing reduction reconciliation, specifies data elements and response to public comments received on information collection notices.

2015

On Jan. 20, 2015, CCIIO presented operationally focused slides on cost-sharing reductions and advance premium tax credit calculations in the context of passive Marketplace reenrollment.

On Feb. 3, in letters to HHS and Treasury, Chairmen Fred Upton (R-MI) and Paul Ryan (R-WI) say ACA cost-sharing reduction payments to QHPs lack a congressional appropriation and ask the agencies to explain under which authority they are disbursing the payments. Also see a release. On Feb. 13, CCIIO posted a bulletin (available on the REGTAP site; account required) addressing the timeframe for reconciling issuers’ advance payments of cost-sharing reductions in April 2016 under the standard methodology, as contextualized in the bulletin.

On Feb. 24, responding to a Feb. 12 letter from Senate Finance Republicans (PDF), HHS Secretary Burwell wrote to Senate Finance Chairman Orrin Hatch that the agency does not have a contingency plan if the Supreme Court invalidates premium subsidies in Federally Facilitated Marketplaces.

On Mar. 16, CMS clarified recent guidance on QHPs’ timing for notifying the agency of their cost-sharing reconciliation methodological selection and addresses the issue of switching between the standard and simplified methodologies.

On Apr. 22, CCIIO released guidance indicating that, instead of continuing last year’s approach (here) of maintaining renewal subsidies at previous levels if consumers did not update income data, CCIIO will use an adjustment for expected income growth to reassess 2016 subsidy eligibility and amounts. Those who exceed 400% FPL and are no longer subsidy-eligible will have their financial assistance discontinued for the 2016 plan year. Consumers who do not update their data for 2015 or 2016 and are reenrolled will have their assistance discontinued in 2017.

On June 19, CCIIO provided guidance to plans on incorporating advance cost-sharing reduction (CSR) payments into 2014 risk corridors and medical loss ratio reporting given that CSR reconciliation is largely postponed until April 2016.

On July 8, in letters to HHS and Treasury, Reps. Tim Murphy (R-PA) and Peter Roskam (R-IL) followed up on earlier requests for the agencies to substantiate their authority to make cost-sharing reduction payments to QHPs under the ACA.

On Sept. 9, the U.S. District Court for the District of Columbia ruled that House Republicans have standing to challenge the Administration’s authority to issue cost-sharing reductions. See a Ways and Means Republican statement here.

On Sept. 14, CMS posted a Paperwork Reduction Act package addressing insurers’ cost-sharing reduction reconciliation process.

2016

On Jan. 19, 2016, CMS released a notice on revised information collection procedures for the data elements QHPs report to facilitate cost-sharing reduction payments. Comments are due by Feb. 19.  Also see an accompanying Paperwork Reduction Act package.

On Apr. 15, CMS announced that QHPs now have until June 3, 2016, to submit data for reconciling 2014 and 2015 advance cost-sharing reduction payments. The agency also set an interim deadline for draft data submission: May 2.

On Apr. 19, CMS posted seven FAQs on QHPs’ reconciliation of advance cost-sharing reduction payments for the 2014 and 2015 benefit years. Also see recent slides.

On May 5, House Energy and Commerce Committee Republicans issued subpoenas to HHS in their ongoing effort to investigate the agency’s authority to make ACA cost-reduction payments to insurers, saying the HHS lacks a congressional appropriation for those payments.

On May 12, a federal judge sided with the GOP and held that the ACA’s cost-sharing subsidies require an explicit appropriation, separate from the appropriation used to fund the premium subsidies available under the law, and enjoined further payment of any cost-sharing subsidies to insurers. The court’s decision is on hold, however, pending appeal. Also see Rep. Fred Upton’s (R-MI) statement on the decision.

On May 13, CMS posted a Paperwork Reduction Act package addressing issuer reporting requirements for delineating their selection of a cost-sharing reduction reconciliation methodology.

In a May 23 letter, House Energy and Commerce and Ways and Means Republicans renewed their call for HHS, OMB, and Treasury documentation underlying ACA cost-sharing reduction payments.

On June 1, CMS posted an FAQ indicating that the amounts listed on error reports, while not final, “can be used as a preliminary calculation of the issuer’s reconciled [cost-sharing reduction] amount.”

On June 20, CCIIO said QHPs may request an alternate timetable for repaying reconciled advance cost-sharing reduction payments by July 5, 2016. Plans must inform their State Insurance Departments that they have requested the flexibility from CCIIO, among other parameters.

On July 5, in a sample letter to QHPs, CCIIO outlines the parameters for its flexible repayment schedule for 2014 and 2015 reconciled advanced cost-sharing reduction payments.

On July 8, the House Energy and Commerce Oversight and Investigations Subcommittee heard testimony from Galen Institute and American Enterprise Institute fellows on the Administration’s funding of ACA cost-sharing reductions, amplifying congressional Republican’s ongoing investigation of the appropriation underlying the advance CSR payments. The hearing followed an Energy and Commerce and Ways and Means Republican staff report describing investigative findings.

On July 13, CMS posted slides outlining a three-level administrative appeals process for QHP issuers appealing 2014 and 2015 reconciliation of advance cost-sharing reduction payments.

On July 15, CMS released a guide reviewing the steps for QHP issuers to request reconsideration of 2014 and 2015 cost-sharing reduction reconciliation amounts.

On July 18, CMS posted the technical specifications for QHP issuers to report discrepancies in cost-sharing reduction reconciliation amounts.

On July 22, CCIIO issued guidance explaining that for the 2017 plan year, the Federally Facilitated Marketplace will flag data-match issues if applicants’ attested income for subsidy eligibility is less than 25 percent (or $6,000) than their income data from the agency’s trusted data sources. The threshold previously was 10 percent. State-based Marketplaces (SBMs) may also use the revised threshold, with a floor of the previous 10 percent. The agency adds that SBMs may propose a “threshold that goes beyond this guidance,” although they must submit a proposal with specified information to CCIIO.

On Aug. 5, CCIIO explained that QHPs may report reconciled 2015 cost-sharing reduction (CSR) amounts, without adjusting for previously reported 2014 CSRs, as part of the 2015 medical loss ratio and risk corridors reporting process. The guidance also explains the “manner in which issuers that are subject to the adjustment to their 2015 risk corridors amounts should report risk corridors amounts for the purposes of MLR reporting.”

On Aug. 17, CMS released guidance noting that while the deadline for 2014 benefit year cost-sharing reduction (CSR) reconciliation data submission has passed, QHP issuers may use the discrepancy reporting process to flag any data issues that may affect 2014 CSR reconciliation accuracy. The discrepancy reporting deadline is Aug. 29. The agency elaborates, “CMS will permit issuers to restate 2014 CSR reconciliation data during the data submission cycle for the 2016 benefit year (Spring 2017) only because of unusual circumstances, such as outstanding appeals or legal issues.”

On Sept. 1, the IRS posted a “tax tip” for Marketplace enrollees regarding reporting changes in circumstances, “Moving in 2016? Notify Your Marketplace about Your New Address.”

On Nov. 2, CCIIO posted a draft manual describing how QHPs reconcile advance cost-sharing reduction payments using three methods specified in regulation. It also addresses data elements that are part of the annual process and highlights new dimensions for the 2016 benefit year. The process begins in April 2017. Also see a related Paperwork Reduction Act package.

2017

On Feb. 22, 2017, the House and Trump Administration filed a joint motion in the U.S. Court of Appeals for the District of Columbia to continue holding House v. Price – challenging the availability of an appropriation for ACA cost-sharing subsidies – in abeyance with status updates due every three months beginning on May 22.

The ACA’s coverage expansions and premium tax credit, vis a vis the ultimately unsuccessful American Health Care Act (AHCA), were extensively discussed at overnight markups of the AHCA by the House E&C and W&M Committees on Mar. 9 (summary) and by the House Budget Committee on Mar. 16 (summary).

On Mar. 24, CMS issued a bulletin on 2017 updated federal poverty level (FPL) guidelines, which are used in premium tax credit and cost-sharing reduction eligibility, among other applications.

On April 13, CMS issued its final rule on stability in the individual and small group insurance markets. The agency largely finalizes its proposals on abridging the 2018 open enrollment period, deferring to states on network adequacy, and widening issuers’ flexibility on actuarial value (AV) via the de minimus variation allowance. The agency also posted several subregulatory guidances, including guidance that cites the Administration’s ACA Executive Order in deferring to states on specified aspects of QHP certification and an FAQ on its approach to assessing compliance for issuers participating in the FFMs.

On April 26, the Trump Administration and congressional Democrats reached an agreement that the Administration would continue paying cost-sharing subsidies for the time being, though the duration of the commitment was uncertain. That quelled the risk of a government shutdown ahead of an April 28 government funding deadline. Minority Leader Pelosi released a statement.

In May 8 slides, CMS highlighted key aspects of its Marketplace stabilization final rule, including guaranteed availability, special enrollment period verification, open enrollment policies.

On May 22, the Trump administration and the House of Representatives filed a joint status report requesting that the Federal appeals court continue to keep the Cost-Sharing Reduction (CSR) subsidy case, House v. Price, on hold. The case is effectively on hold for another 90 days until August 2017, with another status report due at that time.

On May 22, House and Senate Democratic leaders of four health committees wrote to CMS Administrator Seema Verma citing “serious concerns” that she used the continuation of the ACA cost-sharing subsidy payments as a “bargaining chip” with health insurance executives to gain their political support for the American Health Care Act (AHCA).

On May 24, in a letter to President Trump, 196 House Democrats called on the Administration to continue the ACA cost-sharing subsidy payments.

On June 8, HHS issued a Request for Information (RFI) seeking comments on approaches the agency could take to reduce regulatory burdens in the individual and small group markets and saying the agency is “actively working” to further that goal under Title I of the Affordable Care Act (ACA).

On June 8, HHS Secretary Tom Price testified at the Senate Finance Committee (see here) and Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies (see here) on HHS’ FY 2018 budget proposals and took questions on various issues, including the status of ACA cost-sharing subsidies.

2017

On July 31, the House Problem Solvers Caucus, led by Rep. Kurt Schrader (D-OR), Tom Reed (R-NY) and Josh Gottheimer (D-NJ), unveiled a proposal aimed at the immediate stabilization of the individual market.

On July 12, the House Democrats’ Affordable and Accessible Health Care Task Force released a plan to stabilize the individual market.

In Aug. 10 guidance, CCIIO outlined changes it intends to propose in future rulemaking on risk adjustment to account for potential loss of cost-sharing subsidies but said “there have been no changes regarding HHS’ ability to make cost-sharing payments to issuers” at this time.

On July 21, the Senate Parliamentarian ruled that funding cost-sharing subsidies and numerous other provisions of the Senate’s Better Care Reconciliation Act require 60 votes in the Senate.

On Aug. 1, the U.S. Court of Appeals for the District of Columbia Circuit granted a motion by Democrat attorneys general in 17 states and D.C. to intervene in the House v. Pricesuit regarding ACA cost-sharing subsidies. The next status update is due Oct. 30.

On Aug. 15, CBO released a report estimating the effects of terminating ACA cost-sharing subsidies for low to middle income individuals who purchase coverage through an Exchange after December 2017. CBO estimates that withholding ACA cost-sharing subsidies would boost premiums20 percent this year and raise the federal deficit $194 billion over 10 years.

On Aug. 16, the Administration said it would pay August cost-sharing subsidies to insurers. Payments continue to be made on a month-to-month basis.