2019 (Image: Allison Bell/TA)

The Centers for Medicare and Medicaid Services has approved efforts by Maine and Wisconsin to try to hold down individual major medical premiums by setting up state-based reinsurance programs.

CMS — the arm of the U.S. Department of Health and Human Services that oversees Affordable Care Act rules and programs — helped Maine and Wisconsin officials move forward by approving waivers of the usual ACA rules.

(Related: Feds OK Alaska Affordable Care Act Waiver Plan)

The waivers are set to last from 2019 through 2013.

Maine officials are hoping their ACA waiver program will reduce average 2019 individual major medical premiums by about 9%.

Wisconsin officials are hoping their waiver program will reduce average 2019 premiums by 10.6%.

New Jersey has applied to set up a similar reinsurance program. Its application is still going through a public comment period.

ACA Section 1332

When Congress drafted the ACA, it included Section 1332 — the State Innovation Waiver program.

A state can use the Section 1332 waiver process to ask CMS for permission to tweak ACA rules and programs for their residents.

Officials in Maine and Wisconsin asked CMS to let them set up reinsurance programs similar to other state-based reinsurance programs already in effect in Alaska, Minnesota and Oregon.


Officials in Maine hope to use their waiver to reactivate the Maine Guaranteed Access Reinsurance Association, or MGARA, for the period from 2019 through 2013.

MGARA would resurrect an “invisible high risk pool” program, or focused reinsurance program, that reimburses plans for part of the cost of covering patients with uterine cancer, metastatic cancer, prostate cancer, chronic obstructive pulmonary disease, congestive heart failure, HIV, kidney failure and rheumatoid arthritis.

The program would use funding from a variety of sources to pay 90% of covered claims for an eligible patient between an annual “attachment point,” or reinsurance deductible, of $47,000, and a maximum of $77,000.

The program would pay 100% of claims paid in excess of $77,000, after subtracting any reinsurance provided by the federal government.


Officials in Wisconsin say their proposed Wisconsin Healthcare Stability Plan would pay a portion of patient bills between an annual “attachment point,” or reinsurance deductible, of $50,000, and a maximum of $250,000.

The 2019 coinsurance rate for the claims covered would be from 50% to 80%.

The reinsurance program would be funded partly with state money and partly with federal money.

The state’s proposed reinsurance program resembles a state reinsurance programs already operating in Alaska, Minnesota and Oregon.

Public Comments

Many health care provider groups, patient advocacy groups, and insurer organizations, such as America’s Health Insurance Plans, have written to support the states’ reinsurance program applications.

Some individuals have expressed concerns, however.

In Wisconsin, for example, Katie Pope and Abby Hammes wrote to say they worry Wisconsin might shift Medicaid funding into the individual major medical reinsurance program,.


Information about the Wisconsin waiver, and Section 1332 waiver requests and approvals, is available here

— Read Price reboots ACA reboot program, ThinkAdvisor.

— Connect with ThinkAdvisor Life/Health on Facebook and Twitter.