Oklahoma withdraws Section 1332 waiver request

Posted on: 10/4/17

The state of Oklahoma withdrew its request for a State Innovation Waiver under Section 1332 of the Affordable Care Act on Sept. 29, after the U.S. Department of Health and Human Services (HHS) failed to approve the request in time to affect individual health plan premiums for 2018.

Oklahoma’s waiver request proposed to use federal funding to set up a reinsurance program to help insurers manage the cost of high-risk enrollees, lowering premiums in the individual market by up to 35 percent.  

Federal funding would have been available for this reinsurance, because lowered premiums would save the federal government money on premium subsidies.  

The reduced premium cost would have encouraged enrollment, especially by younger and healthier persons, improving the overall risk pool and reducing the uninsured.

Oklahoma Secretary of Health and Human Services Terry Cline’s Sep. 29 letter to the U.S. Departments of Treasury and HHS said the state had relied on repeated assurances of federal waiver approval by Sept. 25, but learned then that approval would not be provided.

OklahomaWatch reports that a federal spokesperson denied that they had promised approval by Sept. 25.  

Oklahoma is not alone in its frustration with the 1332 waiver process. “Minnesota’s experience with its 1332 waiver application has been ... nightmarish” wrote their Gov. Mark Dayton to former HHS Secretary Tom Price last month. Like Oklahoma, Minnesota worked closely with HHS on a state reinsurance program. But Minnesota learned in mid-September that as part of the deal, HHS would cut funding for the MinnesotaCare program for the working poor. (Rick Snyder)