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When a multistate plan is obnoxious

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The U.S. Office of Personnel (OPM) wants to try to help states deal with arrogant multi-state plans (MSPs).

An OPM official named “John” mentions MSP-state conflicts in a comment that officials at the Health Insurance and Managed Care Committee, an arm of the National Association of Insurance Commissioners (NAIC), have posted on their section of the NAIC’s website.

Drafters of the Patient Protection and Affordable Care Act (PPACA) tried to increase the level of competition in the individual and small-group health insurance market by creating the MSP program — a program that will require state health insurance exchanges to offer at least two exchange slots to MSPs, or health insurance plans that will operate in multiple states.

OPM — the agency that oversees the federal government’s popular Federal Employees Health Benefits Program — is in charge of setting up the MSP program.

The creators of the MSP program seemed to want the MSPs to be free from at least some of the usual state-to-state variation in health insurance requirements, but OPM has emphasized that it will respect state insurance regulations and state insurance regulators.

At the NAIC, regulators have been developing a guide for regulators in states in which the U.S. Department of Health and Human Services (HHS) is setting up “federally facilitated exchanges” (FFEs).

In one draft of the guide — which is aimed primarily at states that are uncomfortable with PPACA — drafters said states may want to consider “whether to grant licenses to issuers that intend to offer policies that do not comply with state law and consider themselves to be operating outside of state enforcement authority.”

John, the OPM official, said he would prefer to see the NAIC drafters recommend that state officials consider “working closely with OPM to achieve early resolution of any potential conflicts regarding the applicability of state laws to multi-state plan issuers.”

“This is a more positively framed recommendation,” John said in a comment about the suggested revision, according to the NAIC version of his remarks. 

“We are working to set up a proces with the states (through the NAIC) to work on a memoranda of understanding template that OPM and the states will use to resolve concerns,” John said.

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