1332 Waivers and Potential Implications

When Congress passed the Affordable Care Act (ACA) in 2010 they included a provision, known as section 1332, that would permit states to waive certain requirements of the ACA in order to extend coverage to more individuals.  If approved, these waivers, also called “innovation waivers”, would allow states to offer alternative health care plans so long as the alternative plan retained the basic patient protections under the ACA. 

In theory, 1332 waivers would allow states to develop new and innovative plans and allow states more control of what healthcare options are available to their residents. However, in practice we have seen that 1332 waivers have the ability to both improve access to quality health insurance and jeopardize it.

If the term 1332 waiver sounds familiar, that’s because it has been popping up across the country in states like Kentucky, Maine, Minnesota, Oklahoma, Iowa and more. To date, only a handful of states have received approval for the waiver, but many are considering applying.

In order for a state to receive a 1332 waiver, they must meet certain criteria.  A state legislature must pass legislation that would provide for the implementation of 1332 waivers, and the legislation must retain the same basic protections as plans offered under the ACA. Under the waiver, states must provide access to healthcare policies that are at least as comprehensive and affordable as the state exchange, as well as provide coverage to a comparable number of residents as would be covered absent a waiver. In addition, a new state plan must not increase the federal deficit. However, these consumer protection safeguards are open to interpretation and 1332 waivers could be used as a way to decrease costs, at the expense of patients.

Some of the proposed 1332 waivers would have serious implications for patients with heart disease and other long-term health issues. Proposed waivers in West Virginia and Oklahoma include changes to the “Essential Health Benefits” that could offer less inclusive coverage that would lead to patients paying more out of pocket for prescriptions or for treatment by specialists like Cardiologists. This is just one example (of many) that could have a negative impact on the American population.

However, other states such as Minnesota have utilized 1332 waivers to implement a reinsurance program that bring down costs for consumers while also maintaining a high standard for the comprehensiveness of the plans sold on the marketplaces. This year, Minnesota projects premiums will decrease by [x%], helping more Minnesotans afford quality health care coverage.

Monitoring states 1332 waiver applications is crucial for the American Heart Association as we want to maintain the best access to care, for as many people as possible. The Association will actively monitor any new application submitted to make sure that any potential waiver actually does meet the strict standard that the law calls for and does not decrease the number of insured, or the quality of care available. In short, we need to ensure that the 1332 waiver process is administered as it was intended and that any proposed waiver does not hurt patients access to care.