Overview
On May 6, 2022, the Idaho Department of Insurance applied to the Centers for Medicare and Medicaid Services (CMS) and to the United States Department of the Treasury for a Section 1332 State Innovation Waiver. The purpose of this Innovation “Reinsurance Waiver” is to reduce the cost of individual market health insurance by offsetting the premium impact of high-cost health conditions. The application was approved by the U.S Department of Health & Human Services and the U.S. Department of the Treasury on August 16, 2022. The effective date for the waiver is January 1, 2023.
Resources
- Authorizing Legislation - H611
- Idaho Reinsurance Waiver DRAFT Application
- Idaho 1332 Waiver Comment Period Public Notice
- Idaho 1332 Waiver Application Tribal Notice
- Idaho 1332 Waiver Application Presentation
- Idaho 1332 Waiver Comment Period Public Notice - 4/22/2022 Updated
- Idaho 1332 Waiver Actuarial Analyses and Certification
- Idaho 1332 Reinsurance Waiver Application
- Idaho 1332 Reinsurance Waiver Application Letter of Completeness
- Idaho 1332 Approval Letter and Standard Terms and Conditions
- May 12, 2023 Annual Public Forum Announcement
- May 12, 2023 Annual Public Forum Presentation
Background
In 2017, Idaho legislation was passed which amended Chapter 55, Title 41, Idaho Code, to create an “invisible” reinsurance program within the Idaho Individual High Risk Reinsurance Pool, allowing for reinsurance of individuals and dependents already enrolled in individual health insurance. Eligibility for reinsurance is based on a diagnosis of one or more serious health conditions, as determined by the Pool’s Board. By ceding these high-risk individuals to the Pool and paying a reinsurance premium, carriers are able to mitigate the impact of the costliest health claims to the individual market premiums, as the Pool pays a percentage of the claims once the claims reach an annual threshold. This helps to stabilize the individual health insurance market, resulting in lower premiums than would otherwise occur.
Under section 1332 of the ACA, states can petition for access to federal funding equal to federal healthcare savings created by a state program. Idaho’s Pool is able to save federal tax dollars used to pay Premium Tax Credits for eligible Idahoans, and therefore is expected to meet the criteria for a federal 1332 innovation waiver approval. To date, sixteen other states have approved section 1332 waivers for federal approval and passthrough funding for state-based reinsurance programs, reducing health insurance premiums for plans sold in the individual insurance market.
A public comment period was held from April 1, 2022 through May 1, 2022 in order for stakeholders and members of the public to provide input on the proposed waiver. In addition, four public hearings were held throughout the state (two hearings in Boise, plus a hearing in Idaho Falls and in Coeur d’Alene) in order to provide information and solicit comments on the waiver.
In the application, the Idaho Department of Insurance projected that the Reinsurance Waiver would generate at least a 7% reduction in premium, compared to what would be needed without the waiver. This reduction will provide Idahoans needed premium relief going forward.
On August 16, 2022 the U.S Department of Health & Human Services and the U.S. Department of the Treasury approved Idaho’s application for a Section 1332 State Innovation waiver.
What this means
The state submitted the Section 1332 waiver to increase affordability of individual health insurance in Idaho. This waiver approval is effective January 1, 2023, through December 31, 2027, and it is expected to reduce individual market health insurance premiums by 12% in the first year compared to premiums without the waiver.
Timelines
| March/April 2022 | Publish draft section 1332 waiver application on state website and notify the public. |
| April 1, 2022 | Begin public comment period. |
| April 2022 | Conduct public hearings facilitated in major cities/counties/regions across the state. |
| February, March, April, and May 2022 | Conduct Tribal consultation. |
| May 1, 2022 | End public comment period. |
| May 5, 2022 | Submitted final section 1332 waiver application to the Departments. |
| June 2022 | Target to receive approval from the Departments for the section 1332 waiver. |
Previous Idaho 1332 Innovation Waiver Application:
On July 15, 2019, Idaho submitted a State Innovation Waiver application. The Department of Health and Human Services (HHS) and the Department of the Treasury (collectively, the Departments) determined that the application was not complete on August 29, 2019.
Application:
Correspondence: