Open Mic: State Officials Respond to Proposed Exchange Regulations

Last week I spoke with Norm Thurston, Health Reform Implementation Coordinator of Utah, andJoan Henneberry, Director of Exchange Planning at the Colorado Health Institute, to get their initial reactions to the recently released Exchange regulations from HHS. Utah’s Exchange was established prior to the ACA’s enactment, and Colorado is one of only a handful of states to pass enabling legislation and create a governing board for their Exchange during the 2011 legislative session.
What is your overall impression of the proposed rule? Any thoughts on the flexibility it gives to states?
Norm: At first blush, there are not a lot of major surprises; it was fairly predictable based on what we have heard in previous meetings with HHS.  I am encouraged by the talk about flexibility, and hope that it translates into true flexibility at the end of the process.
Joan: I was surprised at the flexibility around the conditional approval process. Most of us were thinking this was all or nothing. For Colorado, it’s good to know that we have that option, but we are hoping to be fully operational and ready on time for the first enrollment period.
What is your reaction to the provisions regarding Exchange board members and conflicts of interest? Should CMS be more specific about conflict of interest?
Norm: I think that it is overly prescriptive. States create boards all the time, and we’re fully aware of issues related to creating boards. It’s not clear what advantage is gained by a federal rule to tell states how to structure their boards. I think states do a pretty good job of consumer protection and we understand conflict of interest issues.
Joan: Our board is seated already and we have conflict of interest provisions in our own state law and we are operating under those laws. We don’t feel like our rules are in conflict with the proposed rules and we think our board is in compliance with state and federal law.
What is your general feedback about the duration and calendar dates of the initial open enrollment period? Are the enrollment and notice requirements in conflict with your state’s requirements?
Norm: It’s not clear why there needs to be a federal standard for this.  Every state really should figure out what’s best for their market. I don’t see a lot of value added in trying to standardize enrollment and notice across 50 states. This is one area that seems to be overly restrictive and goes beyond the statute’s requirements on HHS and states.
Joan: We are going to comment on this issue. I am preparing a formal document for Colorado’s exchange board on areas in the proposed regulation where I think they should have a conversation and seek public input.  Enrollment periods are one of the areas where CMS particularly wants input.
The proposed regulation prohibits navigators from having a conflict of interest while serving and requires navigators from at least two categories of organizations. What are your thoughts on these specific requirements?
Norm: The requirement that states have to include at least two categories of navigators is completely arbitrary. We’d prefer to let each state try something that works for them. Once 50 states try it, HHS can look at what the states tried and see what works and what didn’t. If all states have to do it the same way, we’ll never get that learning opportunity.
Joan: We completely expected that there would be guidance around this issue. We have a lot of people interested in being navigators and our approach is to try to be as open as we can. We see navigators as our on-the-ground sales force and I think we need a variety of people trained to do the work.
What is your reaction to modeling the Exchange plan process on the existing Medicaid and CHIP state plan process?
Norm: For administrative and certification reasons, I understand why there needs to be some sort of state plan and have a structured layout to evaluate what we’re doing and not doing. But, I think you’d be hard-pressed to find a state that’s very excited about using the state plan process for Medicaid, let alone applying it to a new program.
Joan: I think the SPA (state plan amendment) process can be useful. I would like to know what sort of expectations CMS has about public notice for plan amendments. Do you have to put drafts out there? What sort of process do you need to get public input? We have to get answers fast. Even SPAs can take quite a bit of time.
Have you talked with the insurance department in your state about coordinating rate review and premium increases in the Exchange?
Norm: The rate review we have in our Exchange is the same as outside the Exchange and is conducted by the insurance department.
Joan: We don’t have a formal MOU with the insurance commissioner yet, but we plan to. We plan to use the expertise of the insurance commissioner for rate review and expect them to take on that responsibility on behalf of the Exchange. They’re the experts, they’d do it, and it would be part of the certification process.
What was one thing you were pleasantly surprised to see?
Norm: The federal partnership; states can start now and do as much as they want or can do without having to worry about being completely shut down if they’re not completely operational by 2013.
Joan: The flexibility on timing and the recognition that it doesn’t have to be all or nothing.
Does your state plan to submit comments on the proposed regulation(s) to CMS?
Norm: We’ll definitely submit written comments on all of the proposed regulations.
Joan: Our legislative oversight committee is planning to submit comments, as well as the executive branch. It’s up to the Exchange board to decide if they make formal public comments. I’ve told the board that it’s especially important to make comments where CMS specifically asks for input. It’s a great opportunity to weigh in.
How is your state responding to the proposed Exchange regulations? Is your state or organization planning to submit comments to CMS? Check out our previous blog post to find out where CMS is seeking comments and add your thoughts to our discussion specifically for these proposed