CMS-10637-Marketplace Operations Supporting Statementf

Supporting Statement for Marketplace Operations
(CMS-10637/OMB Control Number: 0938-NEW)
A. Background
The Patient Protection and Affordable Care Act, Public Law 111-148, enacted on March 23,
2010, and the Health Care and Education Reconciliation Act, Public Law 111-152, enacted on
March 30, 2010 (collectively, “Affordable Care Act”), expand access to health insurance for
individuals and employees of small businesses through the establishment of new Affordable
Insurance Exchanges (Exchanges), also called Marketplaces, including the Small Business Health
Options Program (SHOP). The Exchanges, which became operational on January 1, 2014,
enhance competition in the health insurance market, expand access to affordable health insurance
for millions of Americans, and provide consumers with a place to easily compare and shop for
health insurance coverage.
On June 19, 2013, HHS published the proposed rule CMS-9957-P: Program Integrity:
Exchanges, SHOP, Premium Stabilization Programs, and Market Standards (78 FR 37302)
(Program Integrity Proposed Rule). Among other things, the Program Integrity Proposed Rule
sets forth financial integrity provisions and protections against fraud and abuse. On January 30,
2013, CMS published Eligibility Appeals and Other Provisions Related to Eligibility and
Enrollment for Exchanges under the Affordable Care Act (CMS-2334-P) (E&E II Proposed
Rule). On August 30, 2013, HHS published the final rule CMS-9957-F: Program Integrity:
Exchanges, SHOP, Eligibility Appeals (Program Integrity final rule), finalizing a number of the
provisions from the Program Integrity and E&E II Proposed Rules. The third party disclosure
requirements and data collections in the Program Integrity final rule support the oversight of
qualified health plan (QHP) issuers in Federally-facilitated Exchanges (FFEs) and other
provisions. This Information Collection Request (ICR) serves as the formal request for a new
data collection clearance. The original approved ICR affiliated with this final rule (OMB #:
0938-1213) was titled Program Integrity and Additional State Information Collections and
approved on 11/21/2013. This ICR also includes some of the information collection
requirements from the previously approved final rule. The other ICRs from the final rule that are
not included in this request will be submitted for OMB approval under separate collections.
B.

Justification

1.

Need and Legal Basis

Section 1321(c)(1) of the Affordable Care Act requires the Secretary to establish and operate
an FFE within States that either: do not elect to operate an Exchange; or, as determined by the
Secretary, will not have any required Exchange operational by January 1, 2014.
Section 1321(c)(2) of the Affordable Care Act authorizes the Secretary to enforce the
Exchange standards using civil money penalties (CMPs) on the same basis as detailed in

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section 2723(b) of the Public Health Service Act (PHS Act).1 Section 2723(b) of the PHS
Act authorizes the Secretary to impose CMPs as a means of enforcing the individual and
group market reforms contained in Title XXVII, Part A of the PHS Act when a State fails to
substantially enforce these provisions.
Section 1313 of the Affordable Care Act, combined with section 1321 of the Affordable Care
Act, provides the Secretary with the authority to oversee the financial integrity, compliance
with HHS standards, and efficient and non-discriminatory administration of State Exchange
activities. Section 1313(a)(6)(A) of the Affordable Care Act specifies that payments made by,
through, or in connection with an Exchange are subject to the False Claims Act (31 U.S.C.
3729, et seq.) if those payments include any Federal funds.
Section 1401 of the Affordable Care Act amended the Internal Revenue Code (26 U.S.C.) to
add § 36B, allowing a refundable premium tax credit to help individuals and families afford
health insurance coverage. Under sections 1401, 1411, and 1412 of the Affordable Care Act
and 45 CFR part 155, subpart D, an Exchange will make a determination of advance payments
of the premium tax credit for individuals who enroll in QHP coverage through an Exchange
and seek financial assistance. Section 1402 of the Affordable Care Act provides for the
reduction of cost sharing for certain individuals enrolled in a QHP through an Exchange, and
section 1412 of the Affordable Care Act provides for the advance payment of these reductions
to issuers.
Section 1411 of the Affordable Care Act, directs the Secretary to establish a program for
determining whether an individual meets the eligibility standards for Exchange participation,
advance payments of the premium tax credit, cost-sharing reductions, and exemptions from
the shared responsibility payment.
Sections 1412 and 1413 of the Affordable Care Act and section 1943 of the Social Security
Act (the Act), as added by section 2201 of the Affordable Care Act, contain additional
provisions regarding eligibility for advance payments of the premium tax credit and costsharing reductions, as well as provisions regarding simplification and coordination of
eligibility determinations and enrollment with other health programs.
The Affordable Care Act directs issuers offering non-grandfathered health insurance coverage
in the individual and small group markets to ensure that plans meet an actuarial value (AV)
level of coverage specified in section 1302(a)(3) of the Affordable Care Act and as defined in
45 CFR 156.140(b). Consistent with section 1302(d)(2)(A) of the Affordable Care Act, AV is
calculated based on the provision of the essential health benefits (EHB) to a standard
population and is a measure of the percentage of expected health care costs a health plan will
cover for a standard population.
2.

Information Users

1

Section 1321(c) of the Affordable Care Act erroneously cites to section 2736(b) of the PHS Act instead of
2723(b) of the PHS Act.

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The data collections and third-party disclosure requirements will assist HHS in determining
Exchange compliance with Federal standards and monitoring QHP issuers in FFEs for
compliance with Federal QHP issuer standards. The data collection will assist HHS in
monitoring Web-brokers for compliance with Federal Web-broker standards. The data
collected by health insurance issuers and Exchanges will help to inform HHS, Exchanges, and
health insurance issuers as to the participation of individuals, employers, and employees in the
individual Exchange, the SHOP, and the premium stabilization programs.
3.

Use of Information Technology

HHS anticipates that a majority of the systems, notices, and information collection required will
be automated. A majority of the information that is required by the collection of information
will be submitted electronically. HHS staff will analyze or review the data in the same manner
by which it was submitted and communicate with States, health insurance issuers, and other
entities using e-mail, telephone, or other electronic means.
4.

Duplication of Efforts

This information collection does not duplicate any other Federal effort.
5.

Small Businesses

This information collection will not have a significant impact on small business.
6.

Less Frequent Collection

Due to the required flow of information between multiple parties and flow of funds for
payments for health insurance coverage within the Exchange, it is necessary to collect
information according to the indicated frequencies. If the information is collected less
frequently, the result would be less accurate, untimely or unavailable eligibility, enrollment or
payment information for Exchanges, insurers, employers and individuals. This would lead to
delayed payments to insurers; late charges to or payments by employers and enrollees;
inaccurate or inappropriate payments of advance premium tax credits and cost sharing
reductions; the release of misleading information regarding health care coverage to potential
enrollees; and an overall stress on the organizational structure of the Exchanges. If the
information is not collected in the timeframe, HHS will not be able to properly ensure the
financial integrity of Federal funds.
7.

Special Circumstances

There are no special circumstances.
8.

Federal Register/Outside Consultation

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The 60-day Federal Register Notice was published on December 22, 2017 (82 FR 60745). No
comments were received. A 30-day notice will publish in the Federal Register on XX/XX/18 for
the public to submit written comment on the information collection requirements.
No additional outside consultation was sought.

9.

Payments/Gifts to Respondents

No payments and/or gifts will be provided to respondents.
10. Confidentiality
To the extent of the applicable law and HHS policies, we will maintain respondent privacy
with respect to the information collected. Nothing in the information collection should be
interpreted as preventing a State from being allowed to disclose its own data.
11. Sensitive Questions
There are no sensitive questions included in this information collection effort.
12. Burden Estimates (Hours & Wages)
The following sections of this document contain estimates of burden imposed by the
associated information collection requirements; however, not all of these estimates are
subject to the data collection requirements under the PRA for the reasons noted. Salaries for
the positions cited were mainly taken from the Bureau of Labor Statistics (BLS) web site
(http://www.bls.gov/ooh/).
The salaries for the health policy analyst and the senior manager were taken from the Office of
Personnel Management web site. Fringe Benefits estimates were taken from the BLS
December 2015 Employer Costs for Employee Compensation Report. 2
State Specific Standard Population (45 CFR 156.135)
This information collection is not directly tied to the provisions in the Program Integrity final
rule. In 45 CFR 156.135(d), HHS established that beginning in 2015, a State may submit a
State-specific standard population, to be used for AV calculations, so long as the criteria
described in § 156.135(d)(1) through (6) are met. A State that applies must submit to HHS
summary evidence that the requirements described in §156.135 are met and the dataset is in a
format that will support the use of the AV calculator. We expect that for each State choosing
this option, the data submission will require 15 hours from a database administrator at $78.58
an hour, 4 hours of actuarial work at $93.34 an hour, and 1 hour of management review at
$118.44 an hour. Therefore, the total burden hours and cost associated with the reporting
2

BLS December 2015 Employer Costs for Employee Compensation Report (March 10, 2016). Available at:
http://www.bls.gov/news.release/pdf/ecec.pdf.

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requirement for each State choosing this option will be 20 hours at a cost of $1,670.50. It is
impossible to determine how many States will elect this option; therefore, we have estimated
that 51 States elect it. The total burden across all 51 respondents is estimated to be 1,020 hours
at an annual cost of $86,241.00.
Table A
Labor Category

Database
Administrator

Number of Hourly Labor
Respondents Costs (Hourly
rate + 100%
Fringe benefits)
1
$78.58 3

Burden
Hours

Total Burden Total Burden
Costs (per
Cost (All
Respondent) Respondents)

15

$1,178.70

Actuary

1

$93.34 4

4

$373.36

Senior Manager

1

$118.44

1

$118.44

20

$1,670.50

Total

$85,195.50

Enforcement Remedies in Federally-facilitated Exchanges (§156.800 to §156.810)
Subpart I of Part 156 discusses the enforcement remedies in the FFEs. Section 156.800
authorizes HHS to impose sanctions on QHP issuers in an FFE that are not in compliance with
Federal standards. These sanctions may be in the form of a civil money penalty (CMP), as set
forth in §156.805; or decertification of QHPs, as set forth in §156.810. The burden estimates
for the collections of information in this Part reflect our assumption that there will be 739 QHP
issuers and 8,891 QHPs in all FFEs.
Section 156.805(a) states the general process and bases for imposing a CMP on issuers offering
QHPs in an FFE. CMPs will be imposed only for serious issues of non-compliance. We expect
to provide technical assistance to issuers, as appropriate, to assist them in maintaining
compliance with the applicable standards. We also plan to coordinate with States in our
oversight and enforcement activities to avoid inappropriately duplicative enforcement efforts.
Consequently, we anticipate that CMPs will occur infrequently. For purposes of calculating the
estimated burden, we include the burden associated with the CMP in the burden estimate of the
appeal of the CMP. We seek comment on these assumptions.
Section 156.810 sets forth the bases for the decertification of a QHP in an FFE and the general
process for decertification. As with CMPs, HHS expects that decertification will be relatively
infrequent, and reserved for only serious instances of non-compliance with applicable
3

Bureau of Labor Statistics. Database Administrators. http://www.bls.gov/ooh/computer-and-informationtechnology/database-administrators.htm.
4 Bureau of Labor Statistics. Actuaries. http://www.bls.gov/ooh/math/actuaries.htm.

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standards. For purposes of this estimated burden, we include the burden associated with the
decertification with the burden estimate of the appeal of the decertification action. We solicit
comments on these assumptions.
Consumer Cases Related to Qualified Health Plans and Qualified Health Plan Issuers
(§156.1010)
In subpart K of part 156, we describe the information collection requirements that pertain to
the resolution of consumer cases related to QHPs and QHP issuers. Section 156.1010(g)(1)
states that QHP issuers must include the date of case resolution, §156.1010(g)(2) states that
QHP issuers must record a clear and concise narrative documenting the resolution of a
consumer case in the HHS-developed casework tracking system, and §156.1010(g)(3) states
that QHP issuers must provide information about compliance issues found by a State during
the investigation of a case. The burden associated with this requirement would be the time and
effort necessary for staff of a QHP issuer to gather the necessary information related to the
consumer complaint, draft the narrative, and enter the narrative into the electronic HHSdeveloped case tracking system. For the purpose of estimating burden, we estimate 475
issuers. We estimate that, on average, each issuer will utilize 6 insurance caseworkers that
will undertake this work for approximately 800 total burden hours annually at a cost of
$291,072. This is a total of 2,280,000 burden hours and an annual burden cost of
$138,259,200 for all issuers.
Table B
Labor
Category

Insurance
Caseworker
Total

Number of Hourly Labor
Respondents Costs (Hourly
rate + 100%
Fringe benefits)
6

$60.64 5

Burden
Hours

Total Burden
Costs (per
Respondent)

800

$291,072

800

$ 291,072

Total Burden
Costs (All
Respondents)

$138,259,200

Enrollment Process for Qualified Individuals (§156.1230)
Under finalized §156.1230(a)(1)(ii), issuers must provide information on available QHPs when
they choose to use their Web site to directly enroll qualified individuals into QHPs in a manner
considered to be through the Exchange. The QHP information required to be posted on the
Web site includes premium and cost-sharing information, the summary of benefits and
coverage, levels of coverage for each QHP, results of the enrollee satisfaction survey, quality
ratings, medical loss ratio information, transparency of coverage measures, and a provider
directory. In finalized §156.1230(a)(1)(i), an issuer is also required to direct an individual to
complete an application with the Exchange and receive eligibility determinations from the
5

Bureau of Labor Statistics. Insurance Claims Adjusters. http://www.bls.gov/ooh/business-andfinancial/mobile/claims-adjusters-appraisers-examiners-and-investigators.htm.

6

Exchange to allow for an accurate plan selection process. Additionally, §156.1230(a)(1)(iv)
requires the issuer Web site to inform applicants about the availability of other QHP products
available through an Exchange through an HHS-approved universal disclaimer and to display a
Web link to the appropriate Exchange Web site. Issuers are also required to distinguish
between QHPs for which a consumer is eligible and other non-QHPs that an issuer may offer
as finalized in §156.1230(a)(1)(iii). Finally, an issuer needs to submit enrollment information
back to the Exchange including the APTC amount and attestation from an individual as
proposed in §156.1230(a)(1)(v).
The burden for this requirement would be for the issuer to develop its own template and code
and integrate it with the Exchange. After this initial step, the burden on the issuer would be to
maintain the Internet Web site by populating the Web site with information collected per
information collection requirements in this rule and future rulemaking by HHS.
We estimate a number of 80 issuers in 2017 and 100 issuers in 2018 will choose to utilize the
direct enrollment approach subject to these third-party disclosure requirements. We expect that
is will take two health policy analysts 50 hours at $73.10 an hour, two web developers 75 hours
at $62.46 an hour, a senior manager 35 hours at $118.44 an hour, four database administers
100 hours at $78.58 an hour, and two computer programmers 350 hours at $76.48 an hour to
set up and maintain their QHP information on their website following the requirements set out
in final §156.1230(a)(1) each year. Therefore, we estimate that it will require a total of 610
hours at a cost of $47,110.90 per issuer to meet these third-party disclosure requirements.
Table C
Labor Category

Number of Hourly Labor
Respondents Costs (Hourly
rate + 100%
Fringe benefits

Burden Hours Total Burden Costs
(All Respondents)

Health Policy
Analyst
Web Developer

2

$73.10

25

$3,655

2

$62.46 6

37.5

$4,684.50

Senior
Manager
Network
Administrator/
Database
Administrator
Computer
Programmer
Total

1

$118.44

35

$4,145.40

4

$78.58

25

$7,858

2

$76.48

175

$26,768

610

$47,110.90

11

6

Bureau of Labor Statistics. Web Developers. http://www.bls.gov/ooh/computer-and-information-technology/webdevelopers.htm.

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Finalized §156.1230(a)(2) would allow qualified individuals to apply for an eligibility
determination or redetermination for coverage through the Exchange and insurance
affordability programs with the assistance of an issuer application assister. In order for an
issuer application assister to perform those functions, they must receive the proper training.
The burden for this requirement would include the time and effort necessary to develop
training materials for the issuer application assister if the Exchange implements this provision.
The Exchange would be required to develop training materials for issuer staff. We assume that
the 18 State Exchanges will implement this standard. However, we expect Exchanges would
use training materials that will either be developed by HHS for other types of assister training,
including agent/broker training or use their own training materials that they have already
developed for other assisters. Therefore, we anticipate that the time and costs associated with
developing a training program for issuers will be minimal. We estimate it will take a training
specialist 10 hours at $55.98 an hour and a training and development manager 5 hours at
$98.70 an hour to develop training materials for the application assisters, for a total burden of
15 hours. The estimated total burden cost for developing training materials for issuer customer
service representatives for each Exchange is therefore $1,053.30 with a total annual total
burden cost of $18,959.40 across all respondents if 18 State Exchanges undertake these
activities. Since training may be updated on an annual basis, we expect the cost to remain
consistent from year to year.
Table D
Labor
Category

Number of
Employees

Training
Specialist

1

$55.98 7

10

$559.80

$10,076.40

Training and
Development
Manager

1

$98.70 8

5

$493.50

$8,883.00

Total

2

15

$1,053.30

$18,959.40

Hourly Labor Burden Hours
Costs (Hourly
rate + 100%
Fringe benefits

Total Burden
Costs (per
Respondents)

Total Burden
Costs (All
Respondents)

13. Capital Costs

7

Bureau of Labor Statistics. Training and Development Specialists. http://www.bls.gov/ooh/business-andfinancial/training-and-development-specialists.htm.
8 Bureau of Labor Statistics. Training and Development Managers. http://www.bls.gov/ooh/management/trainingand-development-managers.htm.

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There are no anticipated capital costs associated with these information collections.
14. Cost to Federal Government
The initial burden to the Federal government for the establishing the systems and policies
associated with this information collection is $283,311.00. The calculations for CCIIO
employees’ hourly salary was obtained from the OPM website: https://www.opm.gov/policydata-oversight/pay-leave/salaries-wages/salary-tables/pdf/2016/DCB_h.pdf
Table 1 – Administrative Burden Costs for the Federal Government Associated with the
Program Integrity and Additional State Collections
Task
Development of Program Integrity Information
Collections
15 GS-13: 15 x $44.15 x 200 hours

Estimated Cost

$132,450.00

Technical Assistance to States
15 GS-13: 15 x $44.15 x 200 hours

$132,450.00

Managerial Review and Oversight
2 GS-15: 2 x $61.37 x 150 hours

$18,411.00

Total Costs to Government

$283,311.00

15. Changes to Burden
There are no changes to the burden. This is a new data collection.
16. Publication/Tabulation Dates
The results of the collection will not be made public.
17. Expiration Date
XX/XX/2021
There are no instruments associated with this data collection.

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