Patient Protection and Affordable Care Act; Establishment of Exchanges and Qualified Health Plans; Exchange Standards for Employers

SUMMARY: This final rule will implement the new Affordable Insurance Exchanges ("Exchanges"), consistent with title I of the Patient Protection and Affordable Care Act of 2010 as amended by the Health Care and Education Reconciliation Act of 2010, referred to collectively as the Affordable Care Act. The Exchanges will provide competitive marketplaces for individuals and small employers to directly compare available private health insurance options on the basis of price, quality, and other factors. The Exchanges, which will become operational by January 1, 2014, will help enhance competition in the health insurance market, improve choice of affordable health insurance, and give small businesses the same purchasing clout as large businesses.

DATES: Effective Date: These regulations are effective on May 29, 2012.

Comment Date: Certain provisions of this final rule are being issued as interim final. We will consider comments from the public on the following provisions: SUBSEC 155.220(a)(3); 155.300(b); 155.302; 155.305(g); 155.310(e); 155.315(g); 155.340(d); 155.345(a); and, 155.345(g). To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. Eastern Standard Time (EST) on May 11, 2012.

ADDRESSES: In commenting, please refer to file code CMS-9989-F. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission. You may submit comments in one of four ways (please choose only one of the ways listed):

1. Electronically. You may submit electronic comments on this regulation to http://www.regulations.gov. Follow the "Submit a comment" instructions.

2. By regular mail. You may mail written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-9989-F, P.O. Box 8010, Baltimore, MD 21244-8010.

Please allow sufficient time for mailed comments to be received before the close of the comment period.

3. By express or overnight mail. You may send written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-9989-F, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

4. By hand or courier. If you prefer, you may deliver (by hand or courier) your written comments before the close of the comment period to either of the following addresses: a. For delivery in Washington, DC--Centers for Medicare & Medicaid Services, Department of Health and Human Services, Room 445-G, Hubert H. Humphrey Building, 200 Independence Avenue SW., Washington, DC 20201.

(Because access to the interior of the Hubert H. Humphrey Building is not readily available to persons without Federal government identification, commenters are encouraged to leave their comments in the CMS drop slots located in the main lobby of the building. A stamp-in clock is available for persons wishing to retain a proof of filing by stamping in and retaining an extra copy of the comments being filed.)

b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid Services, Department of Health and Human Services, 7500 Security Boulevard, Baltimore, MD 21244-1850.

If you intend to deliver your comments to the Baltimore address, please call telephone number (410) 786-9994 in advance to schedule your arrival with one of our staff members.

FOR FURTHER INFORMATION CONTACT:

Alissa DeBoy at (301) 492-4428 for general information and matters related to part 155.

Michelle Strollo at (301) 492-4429 for matters related to part 155 subparts D and E.

Pete Nakahata at (202) 680-9049 for matters related to part 156.

Rex Cowdry at (301) 492-4387 for matters related to part 155 subpart H and part 157.

SUPPLEMENTARY INFORMATION: Inspection of Public Comments: All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments received before the close of the comment period on the following Web site as soon as possible after they have been received: http://regulations.gov. Follow the search instructions on that Web site to view public comments.

Comments received timely will be also available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.

This final rule incorporates provisions originally published as two proposed rules, the July 15, 2011 rule titled Establishment of Exchanges and Qualified Health Plans ("Exchange establishment proposed rule"), and the August 17, 2011 rule titled Exchange Functions in the Individual Market: Eligibility Determinations and Exchange Standards for Employers ("Exchange eligibility proposed rule"). These proposed rules are referred to collectively as the Exchange establishment and eligibility proposed rules. While originally published as separate rulemaking, the provisions contained in these proposed rules are integrally linked, and together encompass the key functions of Exchanges related to eligibility, enrollment, and plan participation and management. In addition, several sections in this final rule are being issued as interim final rules and we are soliciting comment on those sections. Given the highly connected nature of these provisions, we are combining both proposed rules and the interim final rule into a single final rule for reader ease and consistency with the note that, even though the final rule is shorter than the sum of the two proposed rules, it is longer than each individually.

An updated Regulatory Impact Analysis associated with this final rule is available at http://cciio.cms.gov under "Regulations and Guidance." A summary of the aforementioned analysis is included as part of this final rule.

Abbreviations

Affordable Care Act--The Affordable Care Act of 2010 (which is the collective term for the Patient Protection and Affordable Care Act (Pub. L. 111-148) and the Health Care and Education Reconciliation Act (Pub. L. 111-152))

BHP Basic Health Program

CAHPS Consumer Assessment of Healthcare Providers and Systems

CHIP Children's Health Insurance Program

CMS Centers for Medicare & Medicaid Services

DOL U.S. Department of Labor

ERISA Employee Retirement Income Security Act (29 U.S.C. section 1001, et seq.)

FEHBP Federal Employees Health Benefits Program (5 U.S.C. 8901, et seq.)

HEDIS Healthcare Effectiveness Data and Information Set

HHS U.S. Department of Health and Human Services

HIPAA Health Insurance Portability and Accountability Act of 1996 (Pub. L. 104-191)

HMO Health Maintenance Organization

IHS Indian Health Service

IRS <org value="ACORN:3305938304" idsrc="xmltag.org">Internal Revenue Service

LEP Limited English Proficient

MAGI Modified Adjusted Gross Income

MEWA Multiple Employer Welfare Arrangement

NAIC National Association of Insurance Commissioners

OMB Office of Management and Budget

OPM U.S. Office of Personnel Management

PBM Pharmacy Benefit Manager

PHS Act Public Health Service Act

PRA Paperwork Reduction Act of 1985

QHP Qualified Health Plan

SHOP Small Business Health Options Program

SSA Social Security Administration

SSN Social Security Number

The Act Social Security Act

The Code Internal Revenue Code of 1986

TIN Taxpayer Identification Number

Table of Contents

I. Background

A. Legislative Overview

1. Legislative Requirements for Establishing Exchanges

2. Legislative Requirements for Related Provisions

B. Structure of the Final Rule

II. Provisions of the Proposed Regulation and Analysis of and Responses to Public Comments

A. Part 155--Exchange Establishment Standards and Other Related Standards Under the Affordable Care Act

1. Subpart A--General Provisions

2. Subpart B--General Standards Related to the Establishment of an Exchange by a State

3. Subpart C--General Functions of an Exchange

4. Subpart D--Exchange Functions in the Individual Market: Eligibility Determinations for Exchange Participation and Insurance Affordability Programs

5. Subpart E--Exchange Functions in the Individual Market: Enrollment in Qualified Health Plans

6. Subpart H--Exchange Functions: Small Business Health Options Program (SHOP)

7. Subpart K--Exchange Functions: Certification of Qualified Health Plans

B. Part 156--Health Insurance Issuer Standards Under the Affordable Care Act, Including Standards Related to Exchanges

1. Subpart A--General Provisions

2. Subpart C--Qualified Health Plan Minimum Certification Standards

C. Part 157--Employer Interactions With Exchange and SHOP Participation

1. Subpart A--General Provisions

2. Subpart C--Standards for Qualified Employers

III. Provisions of the Final Regulations

IV. Waiver of Proposed Rulemaking

V. Collection of Information Requirements

VI. Summary of Regulatory Impact Analysis

VII. Regulatory Flexibility Act

VIII. Unfunded Mandates

IX. Federalism

X. Regulations Text

--This is a summary of a Federal Register article originally published on the page number listed below--

Final rule, Interim final rule.

CFR Part: "45 CFR Parts 155, 156, and 157"

RIN Number: "RIN 0938-AQ67"

Citation: "77 FR 18310"

Document Number: "CMS-9989-F"

Federal Register Page Number: "18310"

"Rules and Regulations"