The Centers for Medicare and Medicaid Services (CMS) awarded approximately $1,844,585 to California to use for enforcement and oversight of issuer compliance with select Affordable Care Act (ACA) key consumer protections. In total, CMS awarded approximately $25.5 million to 22 states and the District of Columbia. These awards allow California to use the funding for activities related to planning and implementing selected Federal market reforms and consumer protections that may include: essential health benefits, preventive services, parity in mental health and substance use disorder benefits, appeals processes, and bringing down the cost of health care coverage (also known as medical loss ratio (MLR) provision).
These additional grants will help support California’s efforts to make sure their laws, regulations, and procedures are in line with Federal requirements and that states are able to effectively oversee and enforce issuer compliance with consumer protections guaranteed by the ACA. State Departments of Insurance are vital to the oversight of health insurance issuers and are responsible for ensuring premiums are reasonable and justified, companies are solvent, and consumers are protected.
In the 22 states receiving an award, approximately $21.6 million is being awarded to assist State Departments of Insurance in planning and implementing select key insurance market reforms and consumer protections. The remaining funds will be used towards other allowable expenses under the grant to fund other activities that are not directly related to planning or implementing a single market reform, but that extend across all of the select key market reforms (such as travel, supplies and equipment, and indirect costs). The grant will have a project and budget period of 24 months from the award date, Oct. 31, 2016, to Oct. 30, 2018. Each applicant awarded a grant will receive a minimum baseline amount of $476,998. However, some states chose to request less than the minimum baseline amount. In addition to receiving a baseline award each applicant awarded a grant will also receive funding for the “Selected Market Reforms” and “Workload” funds. Workload funds are determined based on the population and number of health insurance issuers in the State.
Grants will be awarded to the District of Columbia and the following states: Alaska, California, Colorado, Hawaii, Illinois, Indiana, Kentucky, Massachusetts, Maryland, Michigan, Minnesota, Mississippi, North Carolina, Nebraska, New Hampshire, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Utah, and Washington.
The ACA provided $250 million in state rate review grants to improve the process for how states review proposed health insurance rate increases and hold insurance companies accountable for unjustified hikes. In 2015, rate review led to an estimated $1.5 billion in savings for consumers. The funds announced this week are unobligated rate review grant funding from prior years.