Implementing the Affordable Care Act: State Action on the 2014 Market Reforms Kevin Lucia, JD, MHP Katie Keith, JD, MPH The Commonwealth Fund March 12, 2013

CHIR’s Monitoring and Analysis of Health Reform Document state action on the Affordable Care Act in all 50 states and DC, including: Health insurance market reforms Health insurance exchanges; and Other regulatory changes to ensure a level playing field. Comprehensive data collection and real-time analysis of legislation, regulations, and other state materials. Project generously supported by the Commonwealth Fund.

Regulating Health Insurance: Cooperative Federalism States are and continue to be the primary regulators of health insurance for consumers in the individual and small group markets. Congress adopted a cooperative approach for regulating health insurance when it passed HIPAA in 1996 for shared regulation between the federal government and the states. When does the federal government enforce? State reports that it is not enforcing. HHS determination that state has failed to “substantially enforce.” Most stakeholders want the states to implement and enforce the Affordable Care Act.

The Affordable Care Act 2010 – Early Market Reforms Eliminates lifetime and annual caps on benefits essential health benefits Bans preexisting condition exclusions for children under 19 Expands dependent coverage to age 26 without limitations Requires minimum standard of appeals procedures after an insurer denies a claim Implements new medical loss ratio standards Requires review of certain rate increases Establishes temporary federal high risk pools 2012 and 2013 – Preparing for – Heavy Lifting Guaranteed issue/renewal Ban on preexisting condition exclusions Coverage of essential health benefits package Modified community rating based on age, tobacco use, geography, family membership (individual or family coverage) Nondiscrimination Health insurance exchanges Signed March 23, 2010 by President Obama Implemented in phases:

State Action on 2014 Market Reforms Issue brief released in February 2013 and available – with interactive map – on Commonwealth Fund website. Reviewed state legislation, regulations, sub-regulatory guidance on seven of the Affordable Care Act’s most significant consumer protections: Surveyed state regulators to assess whether the state has full authority to enforce the 2014 market reforms without new legislation. Guaranteed issue Waiting periods Rating requirements Preexisting condition exclusions Essential health benefits Out-of-pocket costs Actuarial value

State Action on 2014 Market Reforms State progress in implementing the 2014 market reforms: 11 states and DC passed new legislation on at least one of the seven protections. Only Connecticut addressed all seven protections. 39 states have yet to take action on the seven protections. State ability to enforce the 2014 market reforms: 11 states passed new legislation to enforce the Affordable Care Act. Of the remaining states, at least 22 reported limits on their ability to enforce without new legislation.

State Progress in Implementation

Future Expectations for State Implementation of Market Reforms Most states still have a long way to go but many plan to introduce legislation in States will continue to vary in their approach – including the type of state action they use. State regulators may be creative in implementing the law using existing authority to implement or enforce these reforms. There is a continued need for ongoing monitoring and analysis of state implementation of the Affordable Care Act.

Thank you! Kevin Lucia, JD, MHP Research Professor and Project Director Katie Keith, JD, MPH Assistant Research Professor