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Section 1332 of the Affordable Care Act (ACA) was intended to allow states to apply for waivers to reshape their health insurance and health care delivery systems in order to improve access to high-quality, affordable and comprehensive health coverage. However, by rewriting the guidance on permissible 1332 waiver activities, the Trump administration has encouraged 1332 waiver applications that run counter to the original intent of the law and, like Georgia’s, will undermine the ACA.
Georgia Governor Brian Kemp’s 1332 waiver application consists of two parts:
- Reinsurance, the most widely used 1332 waiver option among other states’ applications, and
- Georgia Access Model, the problematic piece of Georgia’s waiver application, which seeks to replace HealthCare.gov with private insurance companies and brokers as the mechanism for consumers to compare health insurance plans available to them.
The Georgia Access Model would ultimately create barriers to comprehensive coverage and make the health care marketplace even more opaque for consumers – making it harder for them to choose an optimal, affordable coverage option. The waiver application has undergone state review and is currently under federal review, specifically with the Centers for Medicare and Medicaid Services (CMS) and the Department of the Treasury.
Here are the top three reasons why CMS should not approve Georgia’s 1332 waiver:
- The majority of Georgians will be unfamiliar with the new process, leading to trouble navigating the various private insurers’ websites. In 2020, 79 percent of Georgia marketplace enrollees used HealthCare.gov to sign up for coverage, even though they already had the option of using a private broker or insurer website. The HealthCare.gov site facilitates consumers’ coverage selections by providing an objective comparison of all of the comprehensive and affordable options in one place. If Georgia’s 1332 waiver is passed, consumers may be left confused when trying to understand the insurance options available, the most affordable options for themselves and their families, and whether the benefits of a particular insurance option is sufficient for their needs.
Furthermore, Georgia’s waiver application does not include any commitments to outreach and education or any other type of consumer assistance for the “non-marketplace.” Therefore, contrary to Governor Kemp’s unsupported claims that 25,000 Georgians will gain coverage through this 1332 waiver, it is likely that tens of thousands would lose coverage.
- The Georgia Access Model would hinder individuals' understanding of whether they are eligible for Medicaid. A consequential benefit of HealthCare.gov is that through the website, consumers can easily learn whether they are eligible for Medicaid and if so, how to enroll in Medicaid. Medicaid enrollment trends show that one-stop government-run marketplaces (whether state-based or federal) have led to growth in Medicaid enrollment, an indication of how health care has become more accessible to Medicaid-eligible individuals. This would change if CMS approves Georgia’s 1332 waiver.
One of the Trump administration’s waiver principles is to “favor affordable private market programs, including association health plans and short-term limited-duration plans, over Medicaid.” Governor Kemp would not only encourage enrollments in these substandard private plans over Medicaid through the elimination of Georgia’s federal marketplace, he would also deliberately create barriers in how low-income consumers access health care. For instance, potential Medicaid-eligible consumers may be vulnerable to becoming underinsured through the allure of the lower premiums associated with substandard plans or go uninsured due to the complexities of the proposed system.
- Governor Kemp’s 1332 waiver proposal violates the ACA’s statutory “guardrails.” The Obama-era statutory guardrails were established to ensure that the 1332 waivers would not leave people worse off than they would be under the Affordable Care Act. Specifically, the waiver should result in coverage for at least as many people as the ACA, provide coverage options that are as affordable (in terms of out-of-pocket spending) as options under the ACA, provide comprehensive coverage options similar to those under the ACA, and must not increase the federal deficit. By incentivizing substandard coverage options and making the selection process more opaque and confusing, consumers will be worse off in their access to quality, affordable health care – violating nearly all of the guardrails.
How Should Georgia Expand Coverage?
Expand Medicaid! Instead of jeopardizing the health coverage of roughly 500,000 Georgians who currently depend on HealthCare.gov for their health insurance selections, Georgia could close the coverage gap by expanding Medicaid to an estimated 470,000 low-income adults. As we continue to experience the devastating effects of the COVID-19 pandemic, states should be promoting access to health coverage, not obstructing it, and the best way to do this for Georgians is to adopt Medicaid expansion.
If approved, Georgia’s 1332 waiver also poses a risk to residents of other states whose governors may subsequently follow suit and adopt a similar waiver to undermine the ACA in their state. CMS has extended the deadline for the federal comment period to Wednesday, September 23rd and we encourage Georgians and non-Georgians alike to express concerns with the Georgia Access Model. Please submit comments to stateinnovationwaivers@cms.hhs.gov and include “Georgia Section 1332 Waiver Comments” in the subject line. Please include your name, organization (if any), and email address with the comments. For your convenience, you can also use this comment portal to submit comments you wish to be considered by CMS.
Your voice can make a difference in stopping this proposal from moving ahead and becoming a dangerous precedent for other states.