States to receive funding, guidance for health insurance exchanges

According to an announcement by the US Department of Health and Human Services, new funding and implementation guidance will be available for states as they seek to stand up health insurance exchanges and enroll qualified Medicaid applicants under the Affordable Care Act. The new funding opportunities compliment an earlier announcement to create cooperative agreements with up to five states to create model IT infrastructures that all states can use.

Last week, HHS officials announced new matching rates for states as they design and develop new computer systems for Medicaid eligibility and enrollment under healthcare reform. The Centers for Medicare & Medicaid Services (CMS) also indicated that its Office of Consumer Information and Insurance Oversight has issued initial technical guidance to help states design, develop and implement IT systems for new health insurance exchanges, Medicaid and CHIP.

Cindy Mann, CMS deputy administrator and director for the Center for Medicaid, CHIP and Survey and Certification, said the money and guidance is meant to help states create a smooth customer experience and improve federal / state eligibility systems. “The resources and guidance announced today are an important next step in developing seamless systems of coverage and ensuring effective and efficient implementation of health insurance exchanges and a modernized Medicaid program,” she said in a statement.

According to a notice of proposed rulemaking in the Federal Register, state Medicaid eligibility systems will have a chance to receive a 90 percent matching rate for design and development of new systems, with a 75 percent federal matching rate for maintenance and operations. In order to receive the funding, “States must meet a set of performance standards and conditions, including seamless coordination with the exchanges,” the notice says. Funds for the 90 percent rate will be available until the end of 2015, and the 75 percent match will continue beyond that date, assuming the conditions are met.

The 90 percent matching rate will be available for exchange-related Medicaid eligibility system changes as well as for those Medicaid system changes not directly related to the exchanges, the notice indicated.

News of the higher matching rates (currently up to 50 percent of system costs are eligible) comes after an earlier announcement that HHS is giving a handful of states a chance to develop insurance exchange models that can be replicated by others. The “Early Innovators” grants will be available for up to five states who “demonstrate leadership in developing cutting-edge and cost effective consumer-based technologies and models for insurance eligibility and enrollment for Exchanges,” an HHS website says.