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Weird PPACA plans

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Federal officials have been quietly developing the regulatory nuts and bolts to support two little-known Patient Protection and Affordable Care Act (PPACA) health plan programs: the Multi-State Plan (MSP) program and the Basic Health Program (BHP).

Drafters of the 2010 law created the MSP program to give consumers a coverage option somewhat similar to Federal Employees’ Health Benefit Program coverage.

Like the federal employees’ program, the MSP program gives insurers a chance to sell the same plan in many different states, through the PPACA exchange system. The U.S. Office of Personnel Management (OPM), the agency in charge of federal employees’ benefits, is in charge of the MSP program.

In theory, the MSP program could be a playground for all kinds of big, for-profit health insurers and nimble startups. In practice, MSP providers have been Blue Cross and Blue Shield providers or the new nonprofit, member-owned PPACA CO-OP plans.

The BHP program gives a state the option to take 95 percent of the PPACA premium subsidy revenue the federal government would pay for exchange coverage for consumers with incomes under 200 percent of the federal poverty level and use the money to offer the consumers the chance to buy into a Medicaid-like managed care plan program.

The consumers would pay a modest amount for the BHP coverage, and the state would try to use its negotiating clout to get the enrollees better, cheaper coverage than they could get through the regular PPACA exchange program.

The BHP system could appeal to states that would have liked to see Congress offer a government-run, “public option” health insurance throughout the country, in addition to or in place of the PPACA exchange system. Some critics of the BHP system said starting a BHP and an exchange at the same time could smother the exchange.

See also: Basic plans to get tough love

OPM developed the MSP final regulations. The regulations extend and update existing MSP regulations.

The U.S. Department of Health and Human Services (HHS) and an HHS division, the Centers for Medicare & Medicaid Services (CMS), developed the BHP plan final regulations. Those regulations provide the methods and data sources states need to offer a BHP option in 2016, if they want to do it.

For more about what’s in the regulations, read on.

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Multi-State Plan (MSP) program

Federal and state exchange managers have said little about the MSP program since it came to life, but OPM reported in a draft version of the new final regulations that MSP plans collected $1.4 billion in premium revenue in 2014, or $350 per enrollee per month, from 371,000 enrollees. 

In the preamble to the new final regulations, OPM officials say they will refer to the program as the “MSP option,” rather than the “Multi-State Plan” on most references, for the sake of clarity and consistencies.

Some commenters wanted OPM to create new ways for groups of organizations to team up to provide MSP options. OPM declined to do that, but it said it may adjust rules that require issuers to serve many states within a short period.

In the final regulations, OPM also decided against imposing any user fees from issuers that sell MSP coverage through state-based exchanges.

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Basic Health Program

The BHP regulations are technical in nature, and, for example, give the state the option to use 2015 exchange plan premiums in BHP payment calculations.

Officials also adjusted the way states can handle American Indians and Alaska Natives in calculations, and they give states the option of coming up with their own state-specific health risk adjustment mechanisms.

Officials had no estimates of how many states might apply to offer BHP options.

See also: Feds flesh out big new PPACA program