© 2011 Booz Allen Hamilton Inc. Ready for what’s next. Council for Electronic Revenue Communication Advancement (CERCA) 2011 Spring Meeting Presented by.

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© 2011 Booz Allen Hamilton Inc. Ready for what’s next. Council for Electronic Revenue Communication Advancement (CERCA) 2011 Spring Meeting Presented by Abby Block, Senior Executive Advisor May 26, 2011

2 Discussion Topics 2010 United States gubernatorial elections Planning grants Early innovator grants Links between Health and Human Services (HHS) and the Internal Revenue Service (IRS) Role of regulations Issues concerning data flow Taxpayer/consumer perspective

United States Gubernatorial Elections Republican gain Republican hold Democratic gain Democratic hold Independent win No election The United States gubernatorial elections were held November 2, 2010, in 37 states (36 elections were regularly scheduled, whereas a special election was held in Utah). Although Democrats did take five governorships (in California, Connecticut, Hawaii, Minnesota, and Vermont) from Republicans, Republicans took 11 governorships (in Iowa, Kansas, Ohio, Oklahoma, Maine, Michigan, New Mexico, Pennsylvania, Tennessee, Wisconsin, and Wyoming) from Democrats. An independent won one governorship (in Rhode Island) held previously by Republicans, and Republicans won one governorship held previously by an independent (in Florida). Thus, Republicans held a majority of governorships for the first time since before the 2006 elections. Most gains were made in races in which no incumbent was running (because of either term limits or voluntary retirement). Only two sitting governors were defeated for reelection: Democrats Ted Strickland of Ohio and Chet Culver of Iowa.

4 Planning Grants Originally, 48 states and the District of Columbia received planning grants Planning grants were $1 million each Alaska and Minnesota did not apply Florida, Louisiana, and Oklahoma are returning their grants and plan to opt out of operating their own health insurance exchanges Minnesota is opting in

5 Early Innovator Grants On February 16, 2011, HHS announced an award of seven cooperative agreements to help design and implement an information technology (IT) infrastructure needed for operating health insurance Exchanges, particularly with respect to eligibility and enrollment systems Kansas, Maryland, New York, Oklahoma, Oregon, Wisconsin, and a multi-state consortium that the University of Massachusetts (UMASS) Medical School leads will receive roughly $241 million; however, Oklahoma announced recently that it plans to return its innovator grant Using grants, early innovators will develop models and building blocks for Exchange IT systems. States may choose to use these models and building blocks to establish their own Exchanges. States retain the flexibility to develop an Exchange tailored to their unique health insurance market without having to start from scratch

6 Early Innovator Grants, continued The grantees are diverse in terms of region, governance structures, and information systems, ensuring a wide range of IT models To ensure that Exchange IT systems are comprehensive, they must handle not only eligibility and enrollment but also premium tax credits and cost-sharing reductions for eligible consumers. Exchange IT systems also must be interoperable and integrated with state Medicaid programs to allow for switching from private insurance to Medicaid and the Children’s Health Insurance Program (CHIP) as eligibility changes

7 Links Between HHS and IRS Meetings of various work groups began as early as June 2010 and have continued intermittently ever since. Information about interagency meetings is being held closely The White House Office of Health Reform was coordinating the meetings at the political level among all implementing agencies; however, that Office has now merged into the Domestic Policy Council. Ms. Nancy Ann Deparle is now Deputy Chief of Staff Although the agencies share overall goals, views regarding strategy, process, and outcomes likely will differ and must be reconciled, which we can infer is ongoing The Office of Consumer Information and Insurance Oversight’s (OCIIO) move from an independent agency to the Center for Consumer Information and Insurance Oversight (CCIIO) within the Centers for Medicare & Medicaid Services (CMS) changes the climate somewhat

8 Role of Regulations HHS will publish regulations specifying requirements for Exchanges. Issuance has been delayed, and the earliest anticipated date is now July but could move into fall. A draft might already be at IRS for review. IRS should specify changes to tax schedules that the Affordable Care Act (ACA) requires for implementation. HHS will want to give states maximum feasible flexibility. IRS likely will want to minimize changes to current processes. Details are still under discussion within and between agencies. Sensitivities are acute, and details are being held closely.

9 Issues Concerning Data Flow What data will be stored, and where will it be stored? How will data be accessed? Who will have access to the data? What information will be communicated among federal agencies and state agencies? With Exchanges? With individual applicants? With insurance carriers? With employers? What will be the timeframes for data exchange and transmission?

10 Taxpayer/Consumer Perspective Outreach will occur at multiple levels (e.g., HHS, IRS, Exchanges, navigators) Application process could be challenging for some consumers, especially applicants for a premium tax credit and cost-sharing subsidy. Tax filing requirements could be challenging for some taxpayers. Coordination among agencies responding to taxpayer/consumer inquiries will be critical. Customer service representatives will need to be well informed and equipped to help people navigate among the various agencies and organizations. Callers could have multiple issues.