Office Of Personnel Management
Economically Significant Regulation
Patient Protection and Affordable Care Act; Establishment of the Multi-State Plan Program for the Affordable Insurance Exchanges
December 5, 2012 -
77 FR 72581 -
RIN: 3206-AM47 -
Download Full Notice: Text |
The U.S. Office of Personnel Management (OPM) is issuing a proposed rule to implement the Multi-State Plan Program (MSPP). OPM is establishing the MSPP pursuant to the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, referred to collectively as the Affordable Care Act. Through contracts with OPM, health insurance issuers will offer at least two multi-State plans (MSPs) on each of the Affordable Insurance Exchanges (Exchanges). Under the law, an MSPP issuer may phase in the States in which it offers coverage over four years, but it must offer MSPs on Exchanges in all States and the District of Columbia by the fourth year in which the MSPP issuer participates in the MSPP. OPM aims to administer the MSPP in a manner that is consistent with State insurance laws and that is informed by input from a broad array of stakeholders.
Agency Contact: Julia Elam by telephone at (202) 606- 2128, by FAX at (202) 606-4430, or by email at email@example.com.
This is a proposed regulation.
Comments were due on January 4, 2013.
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What this Rule is Proposing
The US Office of Personnel Management (OPM) is issuing a proposed rule to implement the Multi-State Plan Program (MSPP) pursuant to the Affordable Care Act. Through contracts with OPM, health-insurance issuers will offer at least two Multi-State Plans (MSPs) on each of the Affordable Insurance Exchanges (exchanges). The five main objectives are (1) to ensure a choice of at least two high-quality products to consumers participating on each exchange; (2) to promote competition in the health-insurance marketplace to the benefit of all consumers; (3) to offer plans from the same issuer to families or small businesses that may reside or operate in more than one state; (4) to provide strong, effective contractual oversight of the issuers that choose to offer MSPs; and (5) to work cooperatively with states and HHS to ensure a level. Under the law, an MSPP issuer may phase in the states in which it offers coverage over four years, with at least 60 percent of the states (31 states) in the first year, at least 70 percent (36 states) in the second year, and at least 85 percent (41 states) in the third year. It is the OPM’s statutory responsibility to ensure that there are at least two issuers offering MSPs on each exchange in every state and the District of Columbia.
This is another Affordable Care Act rule that was quickly written without the due diligence required to appropriately assess the effects of setting up a multi-state health-insurance program. Instead, it appears that the agency knew only one regulatory action would be considered and has produced the provided RIA in an effort to minimize both the time and effort costs to satisfy the requirements of Executive Order 12866. The rule repeatedly makes claims with no citations, such as that "across the country, consumers shopping for insurance in the individual and small group market often have limited options. In some States, the market is extremely concentrated. The MSPP will provide consumers in every Exchange with the additional choice of two high-quality health insurance plans, thereby further promoting competition on the Exchanges." Or the proposed rule fails to back up claims such as that "issuers participating in the MSPP will benefit from market efficiencies because they will contract with a single agency—OPM—which will enable them to participate in all Exchanges." The rule relies on the OPM's experience at negotiating on behalf of federal employees in large plans, yet this is the first time they will be negotiating over small and individual plans. The proposed rule is careful to note that these risk pools will be separate from the federal-employee plans, so that costs of the federal plans are not affected. But if it is really the case that there are efficiencies that can be realized with a larger pool, then merging the pools should lower the costs of the federal plan. That OPM is worrying about this does reveal that the premiums of these new multi-state plans might be quite high. This might be due to the fact that even though the OPM has "explicit statutory authority to negotiate with each MSP a medical loss ratio; a profit margin; the premiums to be charged; and such other terms and conditions of coverage as are in the interests of enrollees in such plans," the OPM "may enter into these contracts without regard to competitive bidding laws."
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