Issue Brief | Mar 12, 2013

Purchasing Coverage for Medicaid Beneficiaries in the Exchange: A Review of Premium Assistance Options

Manatt Health Solutions – Deborah Bachrach and Patricia Boozang

This brief prepared by Manatt Health Solutions examines some of the legal, policy and operational issues states should contemplate while considering the possibility of using “premium assistance” to purchase coverage for Medicaid-eligible adults in the Exchange. It overviews the benefits of premium assistance along with the logistical challenges of its implementation.  States have authority under Section 1906 of the Social Security Act to use Medicaid premium assistance to wrap around employer coverage for an employed individual who is also eligible for Medicaid. In January 22, 2013 draft regulations, the Centers for Medicare and Medicaid Services (CMS) proposed to allow states to use Medicaid/CHIP funding to purchase coverage for Medicaid/CHIP eligible beneficiaries in the individual market, including coverage through Qualified Health Plans (QHPs) in Exchanges.