Georgia: Woot! CMS rightly kicks Gov. Kemp's "Georgia Access Model" to the curb!

Back in November I put out a Break Glass In Case Of Fire-style call to action:

About 2 years ago, GOP Georgia Governor Brian Kemp submitted an ACA Section 1332 Waiver request to the Centers for Medicare & Medicaid Services. As Katie Keith of Health Affairs explained at the time, it consisted of two parts...the first of which was fairly noncontroversial, the second of which was...well, not good:

The application reflects a two-phase approach: a state-based reinsurance program to begin in plan year 2021, followed by a transition to the “Georgia Access” model beginning in plan year 2022. Both components of the waiver application would extend through plan year 2025.

As I noted in February 2020, the reinsurance portion of the waiver merits a shrug; over a dozen other states have instituted some sort of state-level reinsurance program using Section 1332 of the the ACA, and assuming the math all checks out and the state has a reasonable method of covering their portion of the costs, that's fine.

It's the second part that's a problem...a major problem:

The Georgia Access model would eliminate the use of HealthCare.gov, transitioning consumers to decentralized enrollment through private web-brokers and insurers. The state would establish its own subsidy structure to allow for 1) the subsidization of plans that do not comply with all the ACA’s requirements; and 2) enrollment caps if subsidy costs exceed federal and state funds.

There's not a single part of the paragraph above which shouldn't be setting off major alarms:

Georgia expects the waiver to increase enrollment in the individual market by about 30,000 people for plan year 2022. This is a significant number of individuals, but the waiver could result in coverage disruption for the more than 450,000 individuals who are already enrolled in ACA coverage through HealthCare.gov. The 30,000 number also pales in comparison to the 1.4 million people who are uninsured in Georgia, more than half of whom are already eligible for ACA subsidies but not enrolled.

It's important to note that this proposal wouldn't simply move Georgia from HealthCare.Gov over to a state-based ACA exchange the way that 18 other states already have; those are basically just state versions of the federal website. Health insurance policies sold on them are still required to be ACA compliant, and ACA subsidies are still restricted to enrollees in those policies, as they should be.

What Georgia's waiver would do is something very different which would completely undermine many of the primary reasons the Patient Protection & Affordable Care Act was passed in the first place.

Well, five months later I'm pleased to report that the Centers for Medicare & Medicaid Services (CMS) have done the right thing:

NEW: Fed'l govt. suspends Gov. Kemp's plan to separate GA from HealthCare.Gov with no replacement. CMS points to expected coverage losses for Georgians. GA has 90 days to submit a corrective plan but this may be the beginning of the end... #gapol

— Laura Colbert (@ColbertLLC) April 29, 2022

From the actual official CMS notification letter itself:

This letter is a follow-up to our last letter dated November 9, 2021, from the U.S. Department of Health and Human Services (HHS) and the Department of the Treasury (collectively, the Departments). I am sending this letter to the State of Georgia (“Georgia” or “the State”) from the Centers for Medicare & Medicaid Services (CMS) within HHS on behalf of both Departments. For the reasons discussed below, the Departments are suspending implementation of the Georgia Access Model, Part II of Georgia’s section 1332 waiver that was initially approved on November 1, 2020, unless Georgia responds before July 28, 2022, by sending a corrective action plan that would bring the waiver, with the Georgia Access Model in place, into compliance with the statutory guardrails or by submitting a written challenge to the Departments’ determinations.

The Departments are committed to working in partnership with states on policies that improve health care coverage in their states. The Departments remain committed to working with state partners, like Georgia, to ensure access to high-quality, affordable, comprehensive health coverage through section 1332 waivers within statutory guardrails and protections under the Affordable Care Act (ACA). These statutory guardrails include ensuring that the waiver will provide coverage to a comparable number of residents, that the coverage will be at least as comprehensive and affordable as coverage provided without the waiver, and that the waiver will not increase the federal deficit.

During the 2022 Open Enrollment Period (OEP), over 700,000 Georgians signed up for coverage through the Marketplace. As of January 27, 2022, 701,135 individuals in Georgia have coverage through the Marketplace. Both the Departments and Georgia have a shared interest in ensuring these individuals continue to have affordable, comprehensive coverage options and that enrollment does not decrease. The Departments have a duty to oversee and monitor any approved waiver under section 1332 of the ACA and consequently have sent three letters to the State requesting an updated analysis for Part II of the State’s section 1332 waiver, the Georgia Access Model, given changes in federal law, policy, and other circumstances (like changes in the individual health insurance market) that have occurred since the original approval. However, to date, Georgia has not provided the Departments with the requested information.

The Departments’ decision is based on two independent findings: (1) the State has materially failed to comply with its section 1332 waiver’s specific terms and conditions (STCs) by repeatedly not providing the Departments with the information requested as part of our oversight and monitoring authority; and (2) the Georgia section 1332 waiver, with the Georgia Access Model in place, no longer meets the statutory guardrails.

Specifically, the waiver, with the Georgia Access Model in place, does not meet the statutory requirement that it will provide coverage to at least a comparable number of residents as without the waiver (the “statutory coverage guardrail”) in light of changes in federal law, policy, and other circumstances since the Departments’ initial approval. These changes affected the background assumptions on which the Departments based our approval of the waiver, including the Georgia Access Model.

Here's the kicker: They determined that Gov. Kemp's plan to scrap HealthCare.Gov or any official ACA exchange in Georgia would, shocker, reduce enrollment by up to 8.4% over the next 5 years compared to what it's expected to be otherwise:

In addition, the Departments worked with Acumen, LLC to analyze the effects of the identified changes in circumstances and to assist the Departments’ evaluation of the ongoing compliance of the waiver, with the Georgia Access Model in place, with the statutory guardrails. The Acumen analysis projects that, as a result of the Georgia Access Model, total non-group (individual market) enrollment is expected to decline in all waiver years, ranging between a 4.4 percent to 8.3 percent decrease in Plan Year (PY) 2023 and an 8.4 percent decrease each year in PYs 2024 through 2027, relative to what Acumen refers to as its baseline with no Georgia Access Model and with reinsurance in place.

It's also important to note that CMS is only scrapping the second part of the waiver; the first part (reinsurance) will remain in place, which is fine:

The report is available on the CMS section 1332 waiver website. In making this determination, the Departments considered public comments received during the federal comment period from November 9, 2021, to January 9, 2022, in which commenters raised concerns that the Georgia waiver, with the Georgia Access Model in place, does not meet the statutory guardrails. This decision to suspend implementation of Part II of Georgia’s section 1332 waiver does not impact the Departments’ approval of Part I of the waiver, the Georgia Reinsurance Program, for which there is no indication that the statutory guardrails are no longer met.

My call to action last winter mainly consisted of asking people to submit comments opposing the "Georgia Access Model" during the public comment period. I'm pleased to report that these are discussed in depth and, while it's possible they would have rejected Kemp's plan anyway, they may have made a difference:

The majority of the comments the Departments received opposed the Georgia Access Model and cited concerns that the State’s waiver, with the Georgia Access Model in place, does not comply with the statutory guardrails. Commenters that opposed the Georgia Access Model expressed concerns about the baseline without-waiver analysis submitted by the State with its initial application given the changes in the current landscape, as well as the waiver’s impact on consumer navigation, health equity, and on-the-ground implementation.

A few commenters expressed support for the Georgia Access Model, highlighting that they believe it would improve the shopping experience and increase enrollment. Furthermore, these commenters expressed their belief, without any updated analyses, that the identified changes in law or policy would not cause the waiver, with the Georgia Access Model in place, to no longer meet the statutory guardrails.

There's one note which gave me a double take when I checked the footnotes...

...Commenters also asserted that Georgia’s initial assumptions in its waiver application are now incorrect given the major changes that have impacted the baseline. For example, one commenter noted that monthly QHP effectuations for 2022 will be at least 140,000 people higher than Georgia assumed it would be, perhaps as much as 200,000 higher due to the COVID-19 SEP and the enhanced subsidies under the ARP.36 Additionally, these commenters noted that the changes have impacted the baseline such that as of December 15, 2021, nearly 654,000 Georgians selected Marketplace plans, 37 exceeding Georgia’s target enrollment for the Georgia Access Model by 261,000 people.

Commenters noted that changes in law (e.g., ARP), policy (e.g., increased outreach, the COVID19 SEPs), and other circumstances (e.g., regulations such as the extended 2022 OEP, and the new SEP opportunity for those at or below 150 percent FPL) increased enrollment, thereby impacting the State’s initial baseline analysis and projections for the Georgia Access Model.

36 Charles Gaba – Individual public comment, available here.

37 Centers for Medicare & Medicaid Services, “Marketplace Weekly Enrollment Snapshot: Week 6,” December 22, 2021. Available here.

Sure enough, I'm comment #101 (page 79 - 81). Huh.

I recognize a few other names which are cited as well: My colleague & friend David Anderson shows up on Page 16; Dania Palanker on Page 21, and so forth.

As for the American Rescue Plan's dramatically expanded subsidies which may or may not be extended beyond 2022, the letter delves into that as well:

Commenters cited a Congressional Budget Office (CBO) analysis projecting that even when the ARP expires, enrollment gains made in light of the ARP would persist beyond 2022, and they further noted that the CBO updated its Marketplace enrollment projections to increase from 8 million to 10 million in 2030. Furthermore, commenters noted that even if subsidies return to pre-ARP levels, most HealthCare.gov enrollees (i.e., 80 percent of 2021 enrollees) would likely be eligible for $0 premium or low-premium plans to make coverage affordable, making them more likely to retain their coverage beyond 2022.38

Again, it's still not 100% guaranteed; as noted in Laura Colbert's tweet announcing the decision...

In accordance with STC 17, Georgia will have 90 days from the receipt of this notice to respond with a written challenge to the Departments’ current determinations or to submit a corrective action plan, consistent with the process discussed below.

In this letter, the Departments outline the information Georgia must provide within 90 days as part of any corrective action plan to demonstrate how the State will improve the Georgia Access Model as needed to meet the statutory coverage guardrail and to ensure the waiver will not result in coverage losses in the State. We expect that to do so, the State would include a revised outreach and communications plan, including planned funding, a spend plan, and additional information on engagement with underserved communities, to ensure additional outreach actions under the Georgia Access Model as part of the outreach and communications plan that are sufficient to replace projected federal outreach spending absent the waiver and to avert the coverage losses due to the transition to Georgia Access Model that are projected by Acumen, net of any coverage increases due to reinsurance.

In addition, the State should, as part of its efforts to avert projected coverage losses, comply with and pass readiness reviews, as specified in the STCs. The Departments are suspending implementation of the Georgia Access Model, Part II of Georgia’s section 1332 waiver plan, effective July 28, 2022, unless Georgia responds before that date by sending a corrective action plan that would bring the waiver, with the Georgia Access Model in place, into compliance with the statutory guardrails or by submitting a written challenge to the Departments’ determinations. 12

While it's theoretically possible that Kemp will come up with something, the odds are...slim.

Today is a good day for the ACA.