This spring, Georgia passed the Patients First Act authorizing the state to seek federal approval for a Section 1115 waiver to implement an alternative Medicaid expansion model and an Affordable Care Act (ACA) Section 1332 waiver to pursue a range of options affecting individual market coverage. Last week, the state released draft versions of both waivers, outlined below.
Most of the components of the state’s 1115 waiver proposal are similar to Medicaid expansion models that have been approved in other states. However, the changes Georgia proposes through its 1332 waiver are more notable for their potential implications and the questions they raise about the parameters and administration of the state’s individual market. This is also the first example of a state seeking a broader 1332 waiver based on guidance released by the Centers for Medicare & Medicaid Services last year, which changed the interpretation of the 1332 waiver’s “guardrails.”
Proposed 1332 Waiver
Georgia is seeking to use Section 1332 waiver authority to implement significant changes to coverage available through its individual market. The proposal includes two phases — the first part of the plan would implement a reinsurance program, and the second portion involves transitioning from a federally-facilitated marketplace (FFM) to a more state-controlled, decentralized model — though it would not be the same as an ACA state-based marketplace.
- Reinsurance program: Similar to many other states, Georgia is proposing to create a statewide reinsurance program beginning in plan year 2021 with the goal of stabilizing the individual market, reducing premiums, and ensuring an adequate selection of insurance carriers. The program would reimburse carriers at tiered rates according to geographic regions in order to provide larger reimbursements to areas with higher premiums.
- Georgia Access Model: Beginning in plan year 2022, the state would implement a number of changes through the proposed Georgia Access Model, including:
- State individual market operational changes: As part of the state’s plan to no longer use the FFM, the state’s Office for Health Strategy and Coordination along with other state agencies would be responsible for determining consumers’ eligibility for coverage, certifying plans offered on the individual market, licensing web brokers, and distributing tax credit dollars and addressing any related appeals.
- State-run subsidy program: The state would develop and administer its own subsidy program, using both federal advance premium tax credits (APTCs) as well as state funds, to help individuals who earn 100 to 400 percent of the federal poverty level (FPL) purchase individual market coverage. The state is also requesting permission to cap consumer enrollment if state costs reach a certain threshold, and if this occurs individuals seeking coverage would be placed on a waiting list.
- Enrollment through web brokers and carriers: The state is proposing to allow consumers to directly enroll in individual market coverage through web brokers and carriers rather than through a centralized state agency model. This would involve giving the web brokers and carriers the responsibility for developing the functions needed to help consumers enroll in coverage, such as plan comparison tools and shopping portals.
- Allowing consumers to purchase alternative coverage options: Although consumers using the Georgia Access Model will still be able to use subsidies to purchase qualified health plans (QHPs), state-certified “non-QHPs” will also be available as a subsidized coverage option. These non-QHPs will not be required to meet QHP standards, including Essential Health Benefit requirements, and consequently would likely be less expensive — although they will be required to maintain pre-existing condition protections. They will also be required to be a major medical health plan and in the individual market’s single risk pool, but they will not be allowed to be medically underwritten.
- Implementation timeline: The state is seeking comments on the proposal through Dec. 3, 2019, and plans to submit the waiver application to federal officials by Dec. 20, 2019, after which a federal comment period would be opened.
Proposed Pathways to Coverage – 1115 Waiver
Rather than implement the ACA’s full Medicaid expansion, Georgia is requesting to expand Medicaid only up to 100 percent of the FPL — at the enhanced ACA Medicaid expansion match rate, which has not yet been approved in any other state — along with the following conditions:
- Eligible individuals: Individuals ages 19 to 64 who are not currently eligible for Medicaid, which would include adults without dependent children with incomes up to 100 percent of the FPL, and parents, caretakers, or guardians with income between 35 to 100 percent of the FPL.
- Work requirement: To be eligible for coverage through the Georgia Pathways to Coverage program, individuals would be required to demonstrate they are working or engaged in other approved activities (e.g., community service, job training) for at least 80 hours per month.
- Employer-sponsored insurance (ESI) premium assistance program: If an eligible individual has access to ESI, the individual will be enrolled in that coverage instead of Medicaid and the state will pay the ESI premiums for the individual if it is more cost-effective for the state.
- Premiums: Some individuals will be required to pay premiums (tiered based on family income), and these premiums will be deposited in a Member Rewards Account.
- Individuals required to pay premiums: Individuals who are eligible for the Georgia to Pathways Coverage program who have incomes of 50 to 100 percent of the FPL, and individuals enrolled in transitional medical assistance.
- Exempt individuals: Individuals with incomes below 50 percent of the FPL; individuals in the ESI premium assistance program; and individuals who are enrolled in and two months after graduation from certain vocational education training programs of highly sought-after trades.
- Penalties for nonpayment: Enrollees required to pay premiums who fail to pay have a three-month period to retain eligibility before being disenrolled.
- Copayments: The same individuals who are subject to premiums will be required to make copayments for certain services that will be assessed retrospectively, but they are not to exceed 5 percent of an individual’s household income when combined with premium payments. Copayments are the same as in the existing state plan, with the addition of a copayment for non-emergency use of the emergency room.
- Member Rewards Accounts: Enrollees’ premium payments will be deposited in a Member Rewards Account, which will also be funded with state contributions. Funds in these accounts can be used for copayments or to pay for additional services that are not covered, such as vision or dental care. Individuals can earn points in their accounts by engaging in healthy behaviors.
- Benefit package and delivery system: The benefit package will mostly align with those provided through the state plan, with the exception of non-emergency medical transportation. Also, while the Early and Periodic Screening, Diagnostic and Treatment benefit for 19- and 20-year-old individuals is part of the state plan benefit package, the proposal requests to waive vision and dental services for these enrollees. For individuals for whom the state is covering the cost of ESI, wraparound benefits are not covered. The program will use a managed care delivery system exclusively.
- Eligibility effective date: The state is requesting to waive retroactive eligibility, and to have eligibility begin the month following the determination of eligibility and the payment of any premium required.
- Implementation timeline: The state is seeking comments on the proposal through Dec. 3, 2019, and is planning to submit the waiver to federal officials on or before June 30, 2020 for a federal comment period. However, if approved, implementation of the program would not begin before July 7, 2021.
Although the timing for implementation of the two waivers differs, the state comment period for both waivers closes on Dec. 3, 2019. For more information and to view the waiver documents, explore the state’s informational page. The National Academy for State Health Policy (NASHP) will be tracking Georgia’s plans as they evolve and will report on other states’ emerging proposals.
For more information about states’ implementation of the ACA’s Medicaid expansion, explore NASHP’s interactive map, Where States Stand on Medicaid Expansion, and for information about states’ marketplace models, view NASHP’s map, Where States Stand on Exchanges.