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States Can Waive ACA Provisions with Alternative Coverage Plans

States may be able to opt out of provisions of the Affordable Care Act (ACA), starting in January 2017. According to guidance released by the Centers for Medicare & Medicaid Services (CMS), states may propose alternative models to provide insurance coverage using 1332 state innovation waivers. These waivers would allow states to edit or end provisions of the ACA, as long as the proposed alternative coverage plan remains budget-neutral and affords the same or more health insurance coverage as provided by ACA reforms. If CMS approves a state’s 1332 waiver, the state may choose to edit or end the following ACA provisions:

  • qualified health plans, including essential health benefits
  • health insurance marketplaces
  • health insurance marketplace subsidies
  • employer mandate
  • individual mandate

States must also provide supporting documentation to CMS for their alternative model that includes the following components:

  • data, assumptions, and targets
  • actuarial analyses of health insurance coverage
  • 10-year budget
  • explanation of how the alternative model would impact health insurance coverage
  • enacted state legislation giving the state the authority implement the planned waiver
  • waiver implementation plan and timeline

If you have any questions or concerns, please contact Beth Feldpush, DrPH, senior vice president of policy and advocacy, at or 202.585.0111.


About the Author

Matt Buechner is the policy and advocacy associate for America's Essential Hospitals.

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