Thinking Ahead on 1332 State Innovation Waivers

As the Affordable Care Act moves into its fifth year, some state leaders are beginning to shift their attention from early implementation challenges to developing longer term goals. A key tool for states may lie in the Affordable Care Act’s 1332 state innovation waivers which can be submitted any time for HHS consideration, but would become effective in 2017. The waivers allow states to propose alternatives to four central provisions of the law: the individual mandate, employer mandate, essential health benefit package, and the health insurance marketplaces. But states must also work within four critical guardrails: any new approach must provide coverage to at least as many people, not increase the federal deficit, and guarantee insurance that is at least as affordable and comprehensive as that under current law. With co-funding from the Robert Wood Johnson Foundation, the project team proposes to prepare an issue brief that will inform both states that are interested in developing innovation waivers and federal officials who will likely issue additional guidance on the waiver process in 2015. The goal of the project is to bring attention to the 1332 waivers, describe what innovations are possible under the waivers, and underscore the critical guardrails in the law that ensure that the 1332 waivers do not compromise the overarching twin goals of the Affordable Care Act: to expand coverage and control costs.