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March 2012 St@teside

State Innovation Waivers Final Rule

On February 22, 2012, the Centers for Medicare & Medicaid Services (CMS) and the Department of the Treasury finalized a rule for State Innovation Waivers authorized under Section 1332 of the Patient Protection and Affordable Care Act (ACA).

The final rule outlines the waiver application process, the content requirements for the application, and the process for the public to review and comment on proposed waivers at both the state and the federal level.

According to a fact sheet released by CMS, the waiver application should include:

  • The provisions of law that the state seeks to waive;
  • An explanation of how the proposed waiver will meet the goals related to coverage expansion, affordability, comprehensiveness of coverage, and costs;
  • An implementation timeline;
  • A budget plan that does not increase the federal deficit, with supporting information;
  • Actuarial certifications and economic analysis to support the state’s estimates that the proposed waiver will comply with the comprehensive coverage requirement, the affordability requirement, and the scope of coverage requirement; and
  • Analyses of the waiver’s potential impact on provisions that are not waived, access to health care services when residents leave the state, and deterring waste, fraud, and abuse.

In order to provide the public with the opportunity to review and comment on the waiver application, states will have to provide information about the waiver application and conduct at least two public hearings. States will have to accommodate interested parties who would like to provide input during the hearings, but may be in various locations throughout the state. This can be accomplished either through the use of phone or videoconferencing or through multiple hearings in different locations.

The rule finalizes proposed regulations and does not provide a specific length for the state and federal public notice and comment periods. Both will depend on whether the waiver proposal is wide-ranging or minor.  The secretary of the U.S. Department of Health and Human Services (HHS) will issue the final decision on the state’s waiver application, following the conclusion of the federal notice and comment period, but no later than 180 days after the preliminary determination is made that the application is complete.

States that receive approval for their applications are required to submit progress reports on a quarterly and annual basis. The reports would have to be published on the state’s public website.  The secretaries of HHS and Treasury will issue further guidance for the periodic reporting process.