by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Last month, the Centers for Medicare and Medicaid Services (CMS) released waiver concepts to give states examples of reforms they could pursue under section 1332 of the Affordable Care Act (ACA). The concepts are a good start, but CMS will need to go much further, with more detailed templates, to get states to take on the risks associated with running their own health reform programs. …
… So far, eight states have received approval for waivers filed under section 1332, but these waivers have all been relatively limited in scope. Seven of the waivers allow states to use some federal funding to pay for reinsurance payments to health plans (reinsurance reduces premiums, and thus federal premium credits; the waivers allows states to use the savings to capitalize their reinsurance funds). The eighth state, Hawaii, used its waiver to conform the ACA’s rules for small employers with those that had been in place in the state since 1974.
Further, at the moment at least, there is no prospect of any state coming forward with an ambitious and interesting waiver request under section 1332, or Medicaid. …
… While CMS is hoping its concept document will spur more state waiver requests, it is unlikely to have this effect. The concepts CMS developed are too general to give states the assurances they need that a waiver they develop and submit will be approved by CMS without a protracted negotiation.
To get a better response, CMS will need to take the next step and draft up actual model waiver plans that, if followed precisely by states, would be approved expeditiously. Model waivers would lower the time and resources states would need to invest in the development of reform plans, and would also lower the risk that whatever time and resources a state invests in the process would be wasted because of a disapproval decision.