|Federal Information & News Dispatch, Inc.|
Good morning, Chairman Baucus, Ranking Member Hatch, and members of the
Through the establishment of the Health Insurance Marketplaces, Americans will be able to purchase high quality, affordable private health insurance, regardless of pre-existing conditions, with financial help for those who qualify. The Marketplaces will allow individuals, families, and small businesses to find qualified private health insurance options and apply for financial help using a web site and a streamlined application that can be completed online. At the same time, the Marketplaces will make it easier than ever before to compare available qualified health plans based on price, benefits and services, and quality. The Marketplaces will also help eligible consumers receive premium tax credits or coverage through the
Additionally, the Small Business Health Options Program (SHOP) will help small businesses who wish to do so provide affordable, quality coverage for their employees. Eligible small businesses will be able to access tax credits through the SHOP and obtain access to information about coverage and options. By pooling people together, reducing transaction costs, and increasing transparency and competition, the
Since the passage of the Affordable Care Act, CMS has been building the infrastructure that will make the Health Insurance Marketplaces a reality. We have established the framework for the Marketplaces through regulations, guidance, and technical assistance to States. n1 We will continue to provide additional guidance about the Marketplaces as needed, and we will do everything possible to continue to answer specific questions and provide technical assistance to States and stakeholders. With the framework established, we are now focusing on establishing the
We have been hard at work to ensure the Marketplaces will be easy to use, when they become operational beginning
A State may choose to partner with the Federal Government to operate a Marketplace. CMS will supply the infrastructure of the Marketplace when States choose to work with the Federal Government; a State may elect to manage certified qualified health plans, provide consumer assistance and outreach for its eligible residents, or do both This partnership can serve as a path for States that are transitioning towards running their own Marketplaces in future years. In each State that has chosen not to partially or fully run its own Marketplace, CMS will leverage States' knowledge and expertise, as well as existing State programs, laws, and the responsibilities of State insurance departments as much as possible.
Regardless of how the Marketplace is managed, consumers will be able to access the Marketplace with ease. All eligible consumers will be able to use a single streamlined application and select from a variety of qualified plans beginning on
Improving Coverage for Consumers through Market-wide Reforms
CMS is working to ensure the plans available for people shopping for individual and small group coverage are affordable and offer coverage for essential health benefits. On
In addition, on
Non-grandfathered individual and small-group plans will also standardize the percentage of health care costs they will cover. The Affordable Care Act sets standards for the actuarial values, or the percentage of total average costs for covered benefits that a plan is required to cover. In general, actuarial value can be considered a general summary measure of health plan generosity. Each actuarial value corresponds to a "metal," such as silver or bronze, for ease of consumer comparison. The metal levels for plans in these markets are:
. bronze plan with an actuarial value of 60 percent, where on average, a consumer would be responsible for 40 percent of the costs of all covered benefits;
. silver plan, with an actuarial value of 70 percent, where on average, a consumer would be responsible for 30 percent of the costs of all covered benefits;
. gold plan, with an actuarial value of 80 percent, where on average, a consumer would be responsible for 20 percent of the costs of all covered benefits; and
. platinum plan, with an actuarial value of 90 percent, where on average, a consumer would be responsible for 10 percent of the costs of all covered benefits.
To streamline and standardize the calculation of actuarial values for health insurance issuers, CMS has released a publicly available actuarial value calculator, which issuers can use to determine health plan actuarial values, based on a national, standard population. The proposed rules would also allow States to submit data after
Providing Qualified Health Plans in the Marketplace
When consumers visit the new Marketplace on
From the beginning, CMS has been committed to flexibility for States. According to the Final Rule that CMS issued in
States have already had health insurance issuers express interest in operating in a State's Marketplace. States that are running their own Marketplaces are managing plans in different ways. For instance, in
CMS has worked with issuers to ensure consumers will have access to many different types of qualified health plans when they come to each Marketplace to shop for health insurance. For example, since
Applying for Affordable Health Coverage in the Marketplace
CMS and our State partners have taken a number of steps to ensure that each Marketplace is ready to help consumers find and enroll in private health insurance plans. When consumers visit the website of their Marketplace on
To develop the applications that individuals and small businesses will use to apply for health benefits coverage in the Marketplaces, CMS consulted with stakeholders, consumer groups, and the
After a consumer fills out the single, streamlined application, the Marketplace will verify applicant information with existing electronic data sources from Federal and State agencies and commercial entities; this information will be subjected to strong privacy and security protections and its disclosure among the Federal agencies will be subject to compliance with the Privacy Act and all other relevant confidentiality statues and regulations. Consumers will be able to notify their Marketplace of any changes in their status, including marriage, divorce, or a job or income change, that might affect their eligibility easily.
The Marketplace will verify information related to citizenship or immigration status, residency, access to minimum essential coverage, income, and other eligibility factors. Consumers also will be able to keep their coverage from year to year through a simple eligibility redetermination process. The Final Rule establishing the standards for the Marketplaces n10 outlined the processes that will guide these eligibility determinations.
Regardless of who operates the Marketplace, CMS is working to ensure streamlined and secure access to a variety of information sources that are essential for operation. CMS is building a single Data Services Hub that all Marketplaces in every State can access. The hub will verify consumer information through one connection to the
In the hub, data will be routed, and not stored in the system, ensuring that the data flows where it is needed. The hub will access only the information needed to determine individual eligibility and will not be involved in the selection or certification of health plans.
We have completed the hub's technical design, and have almost completed the services related to Federal and State agency interactions. We have completed a framework for security across agencies and established protocols for connectivity. We have begun to test the hub across agencies and will soon begin to test the hub with States that are the furthest along with implementing their Marketplaces, and will continue testing throughout the year. The hub will begin officially supporting the verification of applicant information on
Through these streamlined processes, consumers will be able to fill out an application quickly, receive information about whether they are eligible for premium tax credits or cost-sharing reductions or
As set out in a in recent proposed rule, n11 a State that is running its own Marketplace has an option to establish an eligibility appeals process, in which case, CMS would provide a second-level appeal, if requested by an applicant. If a State chooses not to establish an eligibility appeals process under the proposed rule, then CMS would provide a single level of appeal for the State's Marketplace.
Choosing a Qualified Health Plan through the Marketplace
Eligible consumers will go through a streamlined system, either on the Marketplace website or through a toll-free call center, to choose health coverage that best fits their needs. Consumers will be able to research and compare the available qualified health plan options in the Marketplace so they can make informed choices about their coverage. States are customizing their Marketplace websites in order to best meet the needs of their residents. Similar to the eligibility process, the final Marketplace rule ensures Marketplaces develop and follow high standards regarding the privacy and security of personal information while following Affordable Care Act requirements regarding the use of data.
If a consumer or small business needs help understanding the coverage options offered in the Marketplace, a variety of services will be available to assist them, including online and telephone support. These services will be culturally and linguistically appropriate.
The Navigator program included in the Affordable Care Act will play an important role in educating and helping consumers. For the
Additionally, licensed agents brokers, and online brokers may assist consumers and employers with enrolling in a qualified health plan through the Marketplace. CMS will provide agents and brokers with a portal to the
Educating the Public about the Marketplace
CMS and our State partners are working hard to ensure that people who do not currently have employer-sponsored health insurance are aware of the new tools that will soon be available for them. On HealthCare.gov, people can learn about the Affordable Care Act, review health insurance basics such as understanding what their coverage costs, and interact with a checklist on how to prepare for shopping for coverage on the new Marketplace. On HealthCare.gov n12 and on the HealthCare.gov YouTube channel n13 there are several short videos explaining how shopping for qualified health plans in the
Our outreach goes beyond the internet. We are using CMS's experience from the implementations of CHIP and
CMS is also enlisting allies in Federal agencies and the private sector to reach, engage, and assist potential enrollees. We have an inter-department working group with a wide range of Federal agencies to develop ideas and plans to encourage enrollment and distribute information. Other programs can provide Marketplace referral information in regular notices to clients, post Marketplace information on agency websites, and use local and regional offices to inform and reach out to specific populations. CMS is also working with private partners, including non-profits, provider and trade associations, advocacy groups, corporations and businesses, and faith- and school-based groups to distribute information, encourage enrollment, and support community engagement.
CMS, our State partners, and other stakeholders have been hard at work developing these new Marketplaces since the passage of the Affordable Care Act nearly three years ago. We are developing the architecture that will allow the Marketplace to function, and we are working to develop required systems that will ensure income and eligibility is verified correctly, and all data is secure and that consumers have a seamless experience. Additionally, CMS has been working closely with States that are running their own Marketplaces to provide technical assistance and share information about technology to ensure that every State can smoothly begin open enrollment on
As consumers begin to enroll on
n1 Every regulation and guidance issued about the Marketplaces is available at http://cciio.cms.gov/resources/regulations/index.html#hie under the heading "Affordable Insurance Exchanges"
n2 Healthcare.gov will be the website for the
n3 States that are conditionally-approved to run their own Marketplace to date:
n4 Health Insurance Market Rules: http://www.gpo.gov/fdsys/pkg/FR-2012-11-26/pdf/2012-28428.pdf
n5 Notice of Benefit and Payment Parameters for 2014: http://www.gpo.gov/fdsys/pkg/FR-2012-12-07/pdf/2012-29184.pdf
n6 Essential Health Benefits: http://www.gpo.gov/fdsys/pkg/FR-2012-11-26/html/2012-28362.htm
n7 Establishment of Exchanges and Qualified Health Plans Final Rule, http://www.gpo.gov/fdsys/pkg/FR-2012-03-27/pdf/2012-6125.pdf
n9 Video Demonstration of the Application for Comment: http://www.youtube.com/user/CMSHHSgov
n10 Establishment of Exchanges and Qualified Health Plans Final Rule, http://www.gpo.gov/fdsys/pkg/FR-2012-03-27/pdf/2012-6125.pdf
n11 CMS-2334-P http://www.ofr.gov/OFRUpload/OFRData/2013-00659_PI.pdf
Read this original document at: http://www.finance.senate.gov/imo/media/doc/CMS%20Health%20Insurance%20Exchanges%20Testimony%202%2014%2013%20(G%20%20Cohen).pdf
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