STATE OF GEORGIA OFFICE OF THE GOVERNOR ATLANTA 30334-0090 Brian P. Kemp GOVERNOR December 23, 2019 The Honorable Alex M. Azar II, Secretary U.S. Department of Health and Human Services The Honorable Steven T. Mnuchin, Secretary U.S. Department of the Treasury Ms. Seema Verma, Administrator Centers for Medicare & Medicaid Services Dear Secretary Azar, Secretary Mnuchin, and Administrator Verma: The State of Georgia is pleased to submit to the U.S. Department of Health and Human Services (DHHS) the enclosed State Relief and Empowerment Section 1332 Waiver. The Georgia General Assembly authorized this waiver application with the passage of the Patients First Act, which I signed into law on March 27, 2019. Since the implementation of the Patient Protection and Affordable Care Act (PPACA), Georgia's individual market has experienced a myriad of challenges including drastic premium increases, low carrier participation in several counties across the state, and declining enrollment. In addition, Georgia has one of the highest uninsured rates in the country. The challenges present within Georgia's individual market are complex and cannot be solved by a single solution. As such, I am submitting a two-phased application that crafts a program unique to Georgia to address the growing healthcare access and affordability challenges facing many residents across the State. The goals of the Section 1332 Waiver application are to reduce premiums, increase carrier participation, enhance coverage, promote a more competitive private insurance marketplace, and improve the consumer expenence. In Phase I of this application, Georgia is requesting to waive Section 1312(c)(1) of the PPACA for a period of five years starting in Plan Year 2021 to implement a state reinsurance program. In Phase II, Georgia is requesting to waive Sections 130 !(a), 1311, 1402 of the PPACA and Section 36B of the Internal Revenue Code (IRC) for a period of fouryears starting in Plan Year 2022 to transition the State's individual market from the Federally Facilitated Exchange to the new Georgia Access Model. As demonstrated in the comprehensive analysis attached in this application, Georgia's application adheres to the statutory guardrails established by Section 1332, as well as additional principles laid out in r guidance f om the Centers for Medicare & Medicaid Services for both Phase I and Phase II of the application. I request that the Departments consider review and approval of each of the phases of this waiver application separately. Due to the relatively standard nature of reinsurance in Phase I, and our proposed implementation timeline, we would appreciate that the review and approval of the Phase I be accelerated. This is an urgent matteras the Office oflnsurance and Safety Fire Commissioner will begin reviewing health insurer's individual market rates for Plan Year 2021 in the spring of 2020. Moreover, we expect to continue to the collaborative partnership that we have enjoyed with your teams as we continue to work through the technical aspects of Georgia Access in Phase II. Through the passage of the Patients First Act, Georgia has sought to address challenges forhardworking Georgians accessing and affording their health care. Our proposals - both this Section 1332 application and our Section 1115 demonstration application, Georgia Pathways -- seek to create a market where Georgians can have access to affordable, quality healthcare close to home. Through the Administration's leadership, states have been afforded the opportunity to craftinnovative solutions to state specific challenges, and our applications represent a first-stepstate -led innovative approach. Thank you for your consideration. Sincerely, Governor Special Projects, Office of the Governor cc: Mr. Randy Pate, Deputy Administrator & Director, CCIIO Gen. John F. King, Commissioner, Georgia Depa1tment of Insurance Ms. Shantrina Roberts, Associate Regional Administrator, CMS Atlanta Regional Office Georgia Section 1332 State Empowerment and Relief Waiver Application December 23, 2019 The Office of the Governor Table of Contents Executive Summary ........................................................................................................................ 1 Current Landscape....................................................................................................................... 1 Innovative Solutions Proposed in this Section 1332 Waiver ...................................................... 2 Phase I: Reinsurance Program ................................................................................................. 3 Phase II: Georgia Access Model ............................................................................................. 4 Phase I: Reinsurance ....................................................................................................................... 6 Section I: Program Overview ...................................................................................................... 6 Section II: Authorizing Legislation ............................................................................................. 7 Senate Bill 106: Patients First Act........................................................................................... 7 House Bill 186: The Health Act .............................................................................................. 8 Section III: Provisions of the Law the State is Seeking to Waive............................................... 8 Section IV: Compliance with Guardrails: Data, Analyses, and Certifications ........................... 8 Section V: Alignment with Principles ....................................................................................... 10 Section VI: Reporting Targets................................................................................................... 10 Section VII: Implementation Plan and Timeline....................................................................... 11 Section VIII: Public Notice, Comment Process, and Communications Plan ............................ 12 Public Notice ......................................................................................................................... 12 Public Comment Process ....................................................................................................... 13 Reinsurance Program Comments .......................................................................................... 14 Changes to the Waiver........................................................................................................... 16 Tribal Consultation ................................................................................................................ 16 Section IX: Additional Information .......................................................................................... 16 Administrative Burden for Individuals, Issuers, or Employers ............................................. 16 Impact of PPACA Provisions Not Being Waived ................................................................. 16 Impact on Residents Who Need to Obtain Healthcare Services Out-of-State ...................... 16 Providing the Federal Government Information to Administer the Waiver .......................... 16 Guarding Against Fraud, Waste, and Abuse ......................................................................... 16 Information on Groups Convened to Develop This Waiver ................................................. 17 Section X: Administration ......................................................................................................... 17 Phase II: Georgia Access Model ................................................................................................... 18 Section I: Program Overview .................................................................................................... 18 Program Design - Access ...................................................................................................... 18 Program Design – Plan Certification ..................................................................................... 20 Program Design – State Subsidies ......................................................................................... 22 Program Design – State IT Infrastructure ............................................................................. 24 Projected Impact on Consumers ............................................................................................ 25 Section II: Authorizing Legislation ........................................................................................... 26 Senate Bill 106: Patients First Act......................................................................................... 26 House Bill 186: The Health Act ............................................................................................ 26 Section III: Provision of the Law the State is Seeking to Waive .............................................. 27 Section IV: Compliance with Guardrails: Data, Analysis, and Certifications. ......................... 28 Section V: Alignment with Principles ....................................................................................... 30 Section VI: Reporting Targets................................................................................................... 31 Section VII: Implementation Plan and Timeline....................................................................... 31 Section