1-15-14 Supporting Statement_SMART

State-based Marketplace Annual Report Tool (SMART)
Supporting Statement for Paperwork Reduction Act Submissions
A. Background
On March 23, 2010, the President signed into law the Patient Protection and Affordable
Care Act (P.L. 111-148) and on March 30, 2010, he signed the Health Care and
Education Reconciliation Act of 2010 (P.L. 111-152) into law. Collectively, the two laws
comprise the Affordable Care Act (ACA). The ACA creates new competitive private
health insurance markets – referred to as State-based Marketplaces (SBMs) – that will
give millions of Americans and small businesses access to affordable healthcare
coverage. To best meet the needs of the individual states to provide these services, the
ACA provides them with the maximum flexibility to design, implement, and operate the
market within their state.
The U.S. Department of Health and Human Services (HHS) works collaboratively with
SBMs. As these Marketplaces move from design and implementation to operations,
HHS will provide oversight and monitoring to ensure adequate operational systems. The
effective and efficient oversight of Marketplaces will include monitoring, reporting, and
oversight of financial and other Marketplace activities. These mechanisms will ensure
the Marketplaces are meeting the standards of the ACA and consumers receive both
appropriate choices of available coverage and advance payments of the premium tax
credit or cost-sharing reductions to which they are entitled.
HHS oversight of SBMs will promote transparency and ensure compliance with
Marketplace-related standards while preserving states’ traditional roles in overseeing
their insurance markets. To that end, there are numerous regulatory requirements
described in the Exchange Final Rule, the Program Integrity Rule, and other regulatory
guidance with which SBMs must comply. Regulatory requirements include submitting
reports such as an annual financial statement, eligibility and enrollment reports, and the
Small Business Health Option Program (SHOP) reports to the Internal Revenue Service
(IRS) on employer participation, employer contributions, and employee enrollment.
Other regulatory requirements address security and privacy safeguards, stakeholder
consultations, and funding obligations for SBM operations, beginning in 2015.
In order to ensure the SBMs are complying with the full range of reporting requirements,
SBMs must submit the State-based Marketplace Annual Report Tool (SMART) to HHS.
This report will include all reporting requirements for SBMs and will be used as the
vehicle for evaluating comprehensive compliance with regulations and standards of the
Centers for Medicare & Medicaid Services (CMS). This report will include State
Blueprint Profiles that compile information annually on key operational and performance
requirements, attestations of SBM compliance with ACA requirements, attestations of
compliance with eligibility and enrollment requirements, performance monitoring data,
attestations on gaps or failures that would affect the functioning of the SBM, and the
annual financial statement and external audit report.

B. Justification
1. Need and Legal Basis
The annual report is the primary vehicle to ensure compliance with all reporting
requirements contained in the ACA. It is specifically called for in Section 1313(a)(1) of
the ACA, which requires an SBM to keep an accurate accounting of all activities,
receipts, and expenditures, and to submit a report annually to the Secretary concerning
such accounting. Instructions governing specific facets of the activities covered by the
report are contained both in the ACA and in applicable Federal Regulations.
2. Information Users
CMS and other Federal agencies will use the information collected from states to assist
in determining if a state is maintaining a compliant operational Exchange. It will also
provide a mechanism to collect innovative approaches to meeting challenges
encountered by the SBMs during the preceding year as well as to provide information to
CMS regarding potential changes in priorities and approaches for the upcoming year.
3. Use of Information Technology
The SMART data collection tool will be available on the State Exchange Resource
Virtual Information System (SERVIS) and will permit electronic submission of
responses.
4. Duplication of Efforts
CMS has designed the SMART to reduce the data collection to the maximum extent
possible. While it is intended as a comprehensive compliance review to ensure SBMs
are fulfilling their statutory requirements, very little additional data gathering is required
to complete the form. The respondents can answer most questions by attestations and
uploading existing documents.
5. Small Businesses
This collection does not impact small businesses or other small entities.
6. Less Frequent Collection
CMS cannot conduct this collection less frequently. The ACA requires an annual
submission of the report.
7. Special Circumstances
No special circumstances apply.
8. Federal Register/Outside Consultation
As required by the Paperwork Reduction act of 1995, the Centers for Medicare &
Medicaid Services (CMS) published a 60-day Federal Register Notice (FRN) to provide
interested parties the opportunity to comment on the collections of information required
by the Annual Regulatory Report. The announcement was published as FR Doc. 201327305, and filed on 11-14-13; 8:45 AM.

9. Payments/Gifts to Respondents
There will be no payments or gifts to respondents.
10. Confidentiality
Not applicable.
11. Sensitive Questions
There will be no sensitive questions asked.
12. Burden Estimates (Hours & Wages)
There are currently 19 States operating marketplace formats requiring submission of the
SMART. As a result, 19 total respondents were used to calculate the burden estimates.
CMS used the Bureau of Labor Statistics’ most recent wage estimates
(http://www.bls.gov/oes/current/oes_nat.htm ) as the basis for standard wages to calculate
the burden costs.
Estimated Annualized Burden Table

Forms

Type of
Number of
Respondent Respondents

Annual Regulatory
State Agency
Report
Total

Hours and Costs Table

19

Responses
per
Respondent

Estimated
Burden
hours per
Response

Total
Estimated
Burden
Hours

1

69

1,311

69

1,311

Type of
respondent

Number of
Respondents

Agency head to
Approve Report
Senior-level
manager to
oversee report
Senior-level
manager to
conduct most
writing
Mid-level policy
analyst to
support writing
Mid-level
financial analyst
to support
writing
Administrative
assistant

Responses
per
Respondent

Average
Burden
Hours

Burden
Costs

19

1

2

$64.71

$2,459

19

1

9

$62.03

$10,607

19

1

17

$62.03

$20,036

19

1

25

$51.09

$24,268

19

1

14

$45.04

$11,981

19

1

2

$22.97

$873

Total

13. Capital Costs
None
14. Cost to Federal Government
None
15. Changes to Burden
This is a new collection of information.
16. Publication/Tabulation Dates
The results of this collection will not be published.
17. Expiration Date
No exemption required.

Wage per
Hour (incl
fringe)

69

$70,223