Bookmark and Share

October 2014 St@teside

Three States Awarded New Establishment Grants

On October 14, the Centers for Medicare and Medicaid Services (CMS) awarded level one Exchange Establishment Grants to Massachusetts, Rhode Island, and Virginia, totaling $29.9 million. One final opportunity remains for Marketplaces to apply for Exchange Establishment Grants, with applications for this final round due by November 14.

While states can still acquire Exchange Establishment Grants to support the development of their exchanges, these funds can only go toward design, development, and implementation activities, including establishing exchange functions and operating systems, and testing and improving systems and processes. Rhode Island, for instance will use its latest award to improve its exchange’s IT system and other processes, and to support reenrollment activities during the upcoming open enrollment period. State Partnership Marketplace and states with a Federally-Facilitated Marketplace can also receive establishment grants to support stakeholder engagement, plan management, risk adjustment and reinsurance, and monitoring and oversight. CMS prohibits the use of establishment grants to support maintenance and operating costs, such as rent, software maintenance, telecommunications, utilities, and base operational personnel/contractors.

The November 14 deadline is especially critical for the seven states with Partnership Marketplaces, since it’s their last opportunity to secure federal funds to support their transition to State-Based Marketplaces. With federal funding for Marketplaces ending in 2015, it is generally thought that Partnerships will be phased out; however, there has been no clear guidance from the federal government on what will happen to the Partnership Marketplaces.