Trump administration approves Oregon's 1332 waiver

Document titled, Affordable Care Act
Oregon will be able to waive the Affordable Care Act’s single-risk-pool requirement in order to set up a reinsurance program in the state. (Getty/Designer491)

More than a week after Oklahoma withdrew its application for a state innovation waiver—citing the government’s failure to approve it in a timely manner—another state that applied for a similar waiver has gotten a much different result.

The Centers for Medicare & Medicaid Services sent a letter to Oregon officials on Thursday informing them that it had approved their application for a state innovation, or Section 1332, waiver. 

With the approval, Oregon will be able to waive the Affordable Care Act’s single-risk-pool requirement in order to set up a reinsurance program in the state, with the goal of reducing premiums for individual market enrollees. The reinsurance program will be partially funded by a state health insurance tax.

The approval of Oregon’s waiver is good news for the state, but likely to be a confusing development for other states that have seen their requests to set up a reinsurance program get a less-favorable reception from CMS. This is despite the fact that the Trump administration has explicitly encouraged states to apply for waivers that use high-risk pools or state-operated reinsurance programs to stabilize their individual markets. 

There’s the case of Oklahoma, in which the state officials say CMS agreed to approve the waiver no later than Sept. 25, then reneged on that promise “with no reason for the delay or timeframe for approval.” The state withdrew its application three days later, given that health plan commitment and rate-filing deadlines had already passed.

RELATED: Waiver weirdness—What the Oklahoma and Iowa cases could mean for other states seeking ACA exemptions

Minnesota had better luck, as it recently received approval for its own 1332 waiver—but with a catch. 

The Trump administration said it would approve the state’s request to set up a two-year reinsurance program, but would not allow the state’s Basic Health Program—MinnesotaCare—to receive pass-through funding. That means funding for the program would be cut by $369 million, according to a letter Gov. Mark Dayton sent to federal health officials, which argued the decision goes against “explicit guidance” that the state received from federal agencies this spring. 

Dayton signed off on the waiver this week, though he also said he remains “strongly opposed” to the Trump administration’s proposed cuts to MinnesotaCare.

Iowa, meanwhile, is still waiting to learn the fate of its request to implement a “stopgap measure” that would revamp the state’s individual insurance market. While many of the changes the state proposed are actually aligned with conservative ideals, the Washington Post previously reported that President Donald Trump personally requested that the Department of Health and Human Services reject the application.

A newly released study from the RAND Corporation casts further doubt on the Iowa waiver’s chances of approval. 

It found that while the measure would lower premiums, decrease the number of uninsured, and decrease average healthcare spending for most groups in the ACA-compliant insurance market, it would also likely increase the federal deficit and cause low-income enrollees to be more likely to forgot necessary care.

“For these reasons, we estimate that the Iowa Stopgap Measure would not meet the 1332 waiver criteria, which stipulate that proposed modifications must not increase the federal deficit,” researchers write.

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