The Affordable Care Act (ACA) allows states, at their discretion, to create a Basic Health Program (BHP), a state‐run, subsidized coverage option for individuals with incomes below 200 percent of the federal poverty level (FPL) who are eligible for a Qualified Health Plan (QHP) with tax subsidies. Some states with existing Medicaid expansion populations are interested in pursuing BHP as a way to offer coverage to this population that will provide a similar level of benefits and costs as available to them under the states’ existing Medicaid programs.
In February 2013, CMS released a “
Questions and Answers: Medicaid and the Affordable Care Act” (FAQ) document that addressed some questions related to the BHP. The document officially stated that proposed rules for BHP would be released in late 2013, with final guidance issued in 2014. CMS is working with interested states to develop potential options to provide coverage to the BHP-eligible population during the months before final guidance is issued.
The potential options available to states include a bridge plan and QHP Premium and Cost Sharing Support. The concept behind
bridge plans was developed by officials in Tennessee. Essentially, a bridge plan is a QHP offered by a Medicaid Managed Care Organization (MCO) to individuals (or family members) enrolled in an MCO plan whose incomes increase above Medicaid-eligibility levels and would be transitioning to coverage through the exchange. In December 2012, CMS issued
guidance that allows a state‐based exchange to certify a Medicaid Bridge Plan as a Qualified Health Plan.
Premium and Cost Sharing Support includes using state funds to offer additional subsidies that “wrap-around” the coverage available through QHPs on the exchange, making premiums and cost-sharing expenses more affordable for lower income individuals and families.
The decisions around how states can offer affordable and high quality coverage to individuals on the lower end of the income scale are complex, particularly for those states that have previously expanded their Medicaid eligibility guidelines. Bridge plans and Premium and Cost Sharing Support are two options for states as they await final guidance from CMS on BHP.
