CMS issued a proposed methodology for determining federal payment amounts to states that create a Basic Health Program for 2017 and 2018.
Here are four things to know about Basic Health Programs and the funding methodology.
1. The Basic Health Program gives states an alternative option to the health insurance marketplace. Individuals with household incomes between 133 and 200 percent of the federal poverty level who aren't eligible for Medicaid, the Children's Health Insurance Program or employer-sponsored coverage can apply. An individual's premium through the Basic Health Program doesn't exceed what an eligible individual would pay if receiving coverage through the marketplace.
2. The proposed funding methodology is substantially the same as the methodology used for 2016. CMS will issue a final notice about the 2017-2018 funding methodology in Feb. 2016.
3. At a minimum, benefits include the 10 benefits outlined in the ACA. States have the option of adding additional benefits. Only two states — Minnesota and New York — currently have Basic Health Programs.
4. The methodology calculates monthly payment rates for states based on a several factors. Payments, which are calculated quarterly, are based on the premium tax credit amount and the cost-sharing reductions for the applicable benefit year. The methodology also determines payment rates for each states for various rate cells, which are determined by age, geographic area, household size, income and the number of people in a household enrolled in the program.
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