States can choose to operate a Basic Health Program under the Patient Protection and Affordable Care Act to provide insurance coverage to people younger than 65 with incomes between the upper threshold of Medicaid eligibility and 200 percent of the federal poverty level and who aren’t eligible for Medicaid, the Children’s Health Insurance Program or affordable employer-sponsored coverage.
According to CMS, states that operate these programs will receive federal funding equivalent to 95 percent of the premium subsidies and cost-sharing reductions the people covered by the initiative would have received if they were eligible to enroll through the health insurance exchanges.
The proposed payment methodology takes into account various factors, including the age and income of the enrollees, whether the enrollment is for individual or family coverage, geographic variations in healthcare spending and the health status of the enrollee. The total Basic Health Program payment amount would be based on multiple “rate cells” in each state. For instance, there would be separate cells for people in each coverage category within a particular age range who live in a specific geographic rating area and live in households of the same size and income range.
CMS will accept comments on the proposed funding methodology for 30 days following its Dec. 23 publication in the federal register.
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