To strengthen health insurance markets and to act on President Donald Trump's Jan. 20 executive order to alleviate the burden of the Affordable Care Act, Health and Human Services Secretary Tom Price is asking governors to apply for state innovation waivers made possible under the ACA.
"State Innovation Waivers that implement high-risk pool/state-operated reinsurance programs may be an opportunity for states to lower premiums for consumers, improve market stability, and increase consumer choice," Price said in the Monday letter.
While four states have applied for waivers -- Alaska, California, Hawaii and Vermont -- only Alaska and Hawaii have programs that have been approved or are moving forward to approval, according to the Centers for Medicare and Medicaid Services.
Hawaii's 1332 waiver is to align its Hawaii Prepaid Health Care Act with the ACA to allow Hawaii to continue administering a program that provides comprehensive coverage to nearly every full-time and many part-time employees in the state. Hawaii's waiver will move to the analysis and approval process.
Price said that in response to initial rate information for plan year 2017 in Alaska indicating that premiums were projected to increase by 42 percent in the individual market, that state implemented a state-operated reinsurance program for 2017 that mitigated the projected rate increase significantly.
Based on that success, Alaska has applied for a Section 1332 waiver to implement a high-risk pool/state-operated reinsurance program, the Alaska Reinsurance Program, for 2018 and future years, Price said.
"We welcome the opportunity to work with states on Section 1332 State Innovation Waivers, and in particular, invite states to pursue approval of waiver proposals that include high-risk pool/state-operated reinsurance programs," Price said.
Minnesota and Oklahoma have also designed programs.
The 1332 state innovation waivers became available under the ACA beginning in 2017.
Federal guidelines mandate the waiver provide coverage to a comparable number of state residents who would be provided coverage absent the waiver, would provide coverage that is at least as comprehensive and affordable, and does not increase the federal deficit.
States receive funding equal to the amount of federal financial assistance that would have been provided to its residents under the ACA, in programs known as pass-through funding.
State innovation waivers may be approved for periods up to five years and may be renewed.