Supporting Statement for the Information Collection Requirements Contained in the State Flexibility to Stabilize the Market Cycle I and Cycle II Grant Program
CMS-10657/
OMB control Number: 0938-1366
A. Justification
Grants to Support States in Providing Added Flexibility to Strengthen the Private Health Insurance
Market through Implementation of Market Reforms under Part A of Title XXVII of the Public Health Service Act
On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act and on March 30, 2010, the Health Care and Education Reconciliation Act of 2010 was also signed into law (collectively referred to as “PPACA”).
The PPACA includes a number of provisions that reform the health insurance market and provide
Federal consumer protections through amendments to Title XXVII of the Public Health Service Act (PHS
Act) and corresponding amendments to the Employee Retirement Income Security Act and the Internal Revenue Code. The PPACA also includes significant grant funding for States to work with the Federal government to implement the market reforms.
Section 1003 of the PPACA adds a new section 2794 to the PHS Act entitled, “Ensuring That Consumers Get Value for Their Dollars.” Specifically, section 2794(a) requires the Secretary of the Department of Health and Human Services (the Secretary) (HHS), in conjunction with the States, to establish a process for the annual review of health insurance premiums to protect consumers from unreasonable rate increases. Section 2794(c) directs the Secretary to carry out a program to award grants to States.
Congress appropriated $250 million to be awarded in Federal fiscal years (FFYs) 2010 through
2014 for the Rate Review Grant Program. Through 2010-2014, there were four cycles of Rate
Review Grants awarded. Section 2794(c)(2)(B) specifies that if there are any appropriated Rate Review
Grant funds that are not fully obligated by the end of FY14, such amounts shall remain available to the Secretary for grants to States for planning and implementing the insurance market reforms and consumer protections under Part A of title XXVII of the PHS Act.
The provisions in Part A of title XXVII of the PHS Act include market-wide reforms in the group and individual private health insurance markets intended to protect consumers, increase transparency, and regulate health insurance industry practices.
On February 5, 2018, the Department of Health and Human Services (HHS) released the Notice of
Funding Opportunity (NOFO) for the State Flexibility to Stabilize the Market Grant Program Cycle I. In Cycle I, HHS awarded $8.6 million to 30 states and the District of Columbia to provide a funding source to enhance the role of States in planning and implementing several of the Federal market reforms and consumer protections
One of the goals of the State Flexibility to Stabilize the Market Cycle II Grant Program (hereafter referred to as “State Flexibility Cycle II Grants” or “State Flexibility Cycle II Grant Program”) is to enhance the States’ ability to effectively regulate their respective health insurance markets through innovative measures that support the pre-selected market reforms and consumer protections under Part A of Title XXVII of the PHS Act. The State Flexibility Cycle II Grant Program will provide a funding source to enhance the role of States in planning and implementing several of the Federal market reforms and consumer protections, which are listed below. State Flexibility Cycle II Grants will provide States with the opportunity to ensure their laws, regulations, and procedures are in line with Federal requirements. The project period and funding awarded to each recipient will be 24 months.
Funding under the State Flexibility Cycle II Grant Program is available to States for activities related to planning and implementing the following provisions of Part A of title XXVII of the PHS Act:
Section 2702 – Guaranteed Availability of Coverage
Section 2703 – Guaranteed Renewability of Coverage
Section 2707 –Non-discrimination under Comprehensive Health Insurance Coverage (Essential Health Benefits Package)
These pre-selected market reforms were chosen due to their relative complexity and the anticipated benefits that these reforms will have on consumers and the premiums they pay. These also represent areas that can help States assess the needs of consumers and support the development of innovative measures to ensure access to affordable health coverage in their respective individual and small group markets.
All fifty States and the District of Columbia are eligible to apply for planning and/or implementing one or more of the three pre-selected market reforms and consumer protections in Part A of title XXVII of the PHS Act. Only one application per State is permitted, except in a State in which there is more than one regulating entity, each with a primary responsibility over the regulation of a portion of the private health insurance market. States must ensure that they are only seeking funding to plan and implement activities that they are not currently receiving Federal grant funding to plan and implement.
Applicants may use grant funds for a variety of planning and implementation objectives related to the pre-selected provisions under Part A of Title XXVII of the PHS Act, including, but not limited to performing market scans of their respective individual and small group markets to ensure access to affordable health care coverage, as well as developing actuarial and economic analyses in an effort to stabilize their markets. States may also perform activities related to enhancing their policy filing review processes to ensure health insurance issuers do not include discriminatory benefit designs that discourage people with potentially high-cost medical conditions from enrolling in those plans and hiring or contracting with a clinician to review formularies.
All applicants must submit a mandatory Letter of Intent by December 11, 2020. CMS uses this information to determine the amount of funding available to each recipient. CMS will provide applicants with information on their funding allocation prior to December 15, 2020.
Baseline funding for State Flexibility Cycle II Grants consists of a minimum of approximately $660,000 for the length of the award. Provided sufficient funds are available after providing each State with baseline funding for a two-year project period, States may also receive supplemental awards called “Workload” funds. Workload funds are determined based on the population and number of health insurance issuers in the State. Following submission of the mandatory Letters of Intent, CMS will inform States of funding allocations, including whether baseline award amounts have increased and if there are sufficient funds available for the “Workload.” The baseline funding formula will be consistent, regardless of the activities for which a State applies for funds.
States that apply for funds are required to complete the grant application. The application for the State Flexibility Cycle II Grants is due on February 3, 2021. Grant awards were issued on September 15, 2021.
States that are awarded funds under this funding opportunity are required to provide the CMS with four quarterly progress reports (per fiscal year), one annual report, and one final report, detailing the State’s progression towards planning and/or implementing the pre-selected market reforms under Part A of Title XXVII of the PHS Act.
The data collection (quarterly, annual, and final reports) are a source of information on the State’s progress with meeting CMS expectations for the State Flexibility Cycle I and II Grant Programs. The reports describe significant advancements towards the State’s goal of planning and/or implementing the pre-selected PPACA market reform activities at the beginning from the time of approval through the completion of the grant period. The data collection is imperative to CMS being able to assess the State’s progress, barriers, and updates on measurable objectives. Without the data collection, CMS will be unable to efficiently monitor the State’s progress. It will also inhibit CMS’ ability to support and share opportunities of best practices with other States.
All reports (quarterly, annual, and final) will be submitted electronically by States via the Health Insurance Oversight System (HIOS)—a web-based reporting and data collection system that is already being used by States in both the Health Insurance Enforcement and Consumer Protections Grant and the State Flexibility Grant Programs. The burden estimates provided in this statement include the time and effort that will be dedicated to uploading information in HIOS.
The information collected for the State Flexibility Grant Program is not duplicative of any information already collected.
Small businesses and other small entities are not affected by this information collection requirement (ICR).
As these grants are multi-year awards, collection at a frequency less than the quarterly, such as annual reporting only, will put the Federal grant program at risk due to a lack of sufficient oversight.
7. Special Circumstances Relating to the Guidelines of 5 CFR 1320.5
No special circumstance.
A Notice was published in the Federal Register on 3/26/2021 (86 FR 70502). No comments were received. No outside consultation was sought.
9. Explanation of any Payment/Gift to Respondents
There will be no payments or gifts to respondents.
No personal health information will be collected. All information will be kept private to the extent allowed by applicable laws/regulations.
11. Justification for Sensitive Questions
No sensitive information will be collected.
TO DERIVE AVERAGE COSTS, WE USED DATA FROM THE U.S. BUREAU OF LABOR STATISTICS’ MAY 2020 NATIONAL
OCCUPATIONAL EMPLOYMENT AND WAGE ESTIMATES FOR ALL SALARY ESTIMATES
(HTTP://WWW.BLS.GOV/OES/CURRENT/OES_NAT.HTM). IN THIS REGARD, THE FOLLOWING TABLE PRESENTS THE MEAN HOURLY WAGE, THE COST OF FRINGE BENEFITS (CALCULATED AT 100 PERCENT OF SALARY), AND THE ADJUSTED HOURLY WAGE.
State Flexibility Cycle I and II Grants Activities
The State Flexibility Cycle I and II Grants provide States with the opportunity to apply for funding to ensure their laws, regulations, and procedures are in line with Federal requirements, and enhance the States’ ability to effectively regulate their respective health insurance markets through innovative measures that support the pre-selected market reforms and consumer protections under Part A of Title XXVII of the PHS Act.
Once applicants are awarded grant funds, they are required to provide CMS with quarterly reports due
30 days after the quarter has ended for the entire duration of the grant. The quarterly reports allow States to update CMS with the progression towards planning and/or implementing the pre-selected PPACA market reforms. Grantees will identify significant events towards the goal in the grant progress reports, in addition to any barriers experienced and plans for rectifying any setbacks. States will also provide an updated budget, work plan and timeline with updated progress towards each objective outlined in the State’s application.
In addition, each grantee must provide CMS with an annual report. This report provides a yearly summary of the progress made towards planning and/or implementing one or more of the three preselected PPACA market reforms. Finally, CMS requires a final report at the end of the grant period. This report provides a cumulative summary of the progress made towards toward planning and/or implementing the pre-selected PPACA market reforms.
THE STATE FLEXIBILITY CYCLE I GRANT PROCESS
12A. Estimated Annualized Burden Hours
Forms (If necessary) |
Type of Respondent |
Number of Respondents |
Number of Responses per Respondent |
Estimated Burden hours per Response |
Total Estimated Burden Hours |
Quarterly Report |
State Government |
5 |
4 |
12 |
240 |
Annual Report |
State Government |
5 |
1 |
20 |
100 |
Final Report |
State Government |
5 |
1 |
20 |
100 |
Total |
|
5 |
5 per year per grantee (4 quarterly reports, 1 annual report, and 1 final report at the end of the grant period0)
|
68 |
340 |
12B. Cost Estimate for All Respondents completing all Reporting Requirements, including the quarterly, annual report, and one final report (Annualized).
Type of respondent |
Number of Respondents |
Number of Responses per Respondent |
Average Burden Hours per Response |
Wage per Hour |
Burden Costs Total Annualized Response |
Burden Costs Per Annualized Response |
|
|
|||||
Medical and Health Services Manager (Occupation Code: 11- 9111) |
5 |
5 |
6.8 |
$114.24 |
$19,420.80 |
$3,884.16 |
Executive Secretaries & Executive Administrative Assistants (Occupation Code: 43- 6011) |
5 |
5 |
6.8 |
$62.72 |
$10,662.40 |
$2,132.48 |
Total |
|
|
13.6 |
|
$30,083.20 |
$6,016.64 |
The wage per hour is taken from the Bureau of Labor Statistics for (1) Medical and Health Service Manager; (1) Executive Secretaries & Executive Administrative Assistants.
The State Flexibility Cycle I Grant’s total burden hours for reporting are estimate to be 13.6 per response. The total cost associated with that estimate is $6,016.64 per response.
THE STATE FLEXIBILITY CYCLE II GRANT PROCESS
12C. Estimated Annualized Burden Hours
Forms (If necessary) |
Type of Respondent |
Number of Respondents |
Number of Responses per Respondent |
Estimated Burden hours per Response |
Total Estimated Burden Hours |
Quarterly Report |
State Government |
29 |
4 |
12 |
1,392 |
Annual Report |
State Government |
29 |
1 |
20 |
580 |
Final Report |
State Government |
29 |
1 |
20 |
580 |
Total |
|
29 |
5 per year per grantee (4 quarterly reports, 1 annual report, and 1 final report at the end of the grant period) |
68 |
1,972 |
|
|
|
|
|
|
12D. Cost Estimate for All Respondents completing all Reporting Requirements, including the quarterly, annual report, and one final report (Annualized).
Type of respondent |
Number of Respondents |
Number of Responses per Respondent |
Average Burden Hours per Response |
Wage per Hour |
Burden Costs Total Annualized Response
|
Burden Costs Per Annualized Response |
|
||||||
Medical and Health Services Manager (Occupation Code: 11- 9111) |
29 |
5 |
6.8 |
$114.24 |
$112,640.64 |
$3,884.16 |
Executive Secretaries & Executive Administrative Assistants (Occupation Code: 43- 6011) |
29 |
5 |
6.8 |
$62.72 |
$61,841.92 |
$2,132.48
|
Total |
|
|
13.6 |
|
$174,482.56 |
$6,016.64 |
The wage per hour is taken from the Bureau of Labor Statistics for (1) Medical and Health Service Manager; (1) Executive Secretaries & Executive Administrative Assistants.
The State Flexibility Cycle II Grant’s total burden hours for reporting are estimate to be 13.6 per response. The total cost associated with that estimate is $6,016.64 per response.
13. Estimates of other Total Annual Cost Burden to Respondents or Record Keepers /Capital Costs There are no additional record keeping/capital costs.
Total government program staffing costs include two GS-12 and two GS-13 with a break down as follows to intake and review quarterly and final reports for an estimated 29 awardees.
GS-13: Full-time (Salary with local cost adjustment: $103,690) |
Annual cost: $103,690 |
GS-13: Full-time (Salary with local cost adjustment: $103,690) |
Annual cost: $103,690 |
GS-12: Full-time (Salary with local cost adjustment: $87,198) |
Annual cost: $87,198 |
GS-12: Full-time (Salary with local cost adjustment: $87,198) |
Annual cost: $87,198 |
|
Total: $381,776 |
The wage is taken from the 2021 OPM Washington, DC GS scale for (2) GS-13 and (2) GS-12.
The reporting requirements have changed due to the conclusion of several grants in Cycle I and the initiation of Cycle II. The number of Cycle I respondents was updated to reflect that only 5 states will remain active in Cycle I. Due to the initiation of Cycle II a new Notice of Funding Opportunity is being released. As a result of Cycle II requirements, burden has increased from 2,108 hours to 2,312 hours.
16. Plans for Tabulation and Publication and Project Time Schedule
The results from the information collection will not be published.
The expiration date and OMB control number are displayed on the first page of each (top right corner) instrument.
0 The final report will be submitted in lieu of the annual report in the last year of the grant
.
| File Type | application/vnd.openxmlformats-officedocument.wordprocessingml.document |
| File Title | Supporting Statement – Grants to States for Heath Insurance Premium Review Cycle II |
| Subject | State Flexibility Grant Program |
| Author | CMS/CCIIO |
| File Modified | 0000-00-00 |
| File Created | 2022-01-11 |