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State Marketplace Profiles: Maryland

Maryland

Updated as of November 13, 2013

Establishing the Marketplace

On April 12, 2011, Governor Martin O’Malley (D) signed SB 182/HB 166 into law establishing the Maryland Health Benefit Exchange (MBHE).1  In May of the following year, Governor O’Malley signed additional Marketplace legislation (SB 372/HB 433) which addressed multiple Marketplace implementation and operational issues and was based on recommendations by the Board of Directors and advisory groups from 2011.2 In August 2012, the state announced that the name for the new insurance Marketplace would be Maryland Health Connection.

Structure: The legislation defines the MBHE as a quasi-governmental organization, specifically a “public corporation and independent unit of state government.”

Governance: The MHBE is governed by a nine-member board, including the Executive Director of Maryland’s Health Care Commission as the Chair, Secretary of Health and Mental Hygiene, Commissioner of Insurance, and six members appointed by the Governor and with consent from the Senate. Half of these members represent employers and individuals using the Maryland Health Connection and half provide specific knowledge and expertise. Board members cannot be affiliated with a carrier, insurance producer, third-party administrator, managed care organization, person contracting or in position to contract with the Marketplace, or any trade associations for these entities.

Current appointed Board members are:
Darrell Gaskin (Vice Chair) Johns Hopkins Bloomberg School of Public Health
Kenneth Apfel, University of Maryland, School of Public Policy
Georges Benjamin, American Public Health Association
Jennifer Goldberg, Maryland Legal Aid Bureau
Enrique Martinez-Vidal, AcademyHealth and Robert Wood Johnson Foundation
Thomas Saquella, Maryland Retailers Association

The Board hired an Executive Director in mid-September 2011.

The MBHE is required by statute to maintain at least two standing advisory committees, though the subjects may change to support the decision-making for that particular year. Currently, the Board has five advisory committees to study particular topics: implementation, the Navigator program, continuity of care, plan management, and web-based entities.3 Staff from the MBHE and other state agencies will look to the Advisory Committees to make recommendations on policy options, not to vote on policy decisions.

Contracting with Plans:  In the first two years of operation, Maryland Health Connection will act as a clearinghouse with any qualified health plan (QHP) in the state eligible to participate. Beginning in 2016, Maryland Health Connection will have the authority to employ an alternative contracting option or active purchaser strategy, such as competitive bidding or negotiations with carriers.

Each carrier must offer at least one QHP in each of the bronze, silver, and gold metal levels. Carriers may submit a single zero cost-sharing plan at the bronze level that is available to Native Americans. Carriers may only offer four benefit plan designs per metal level in the individual and SHOP Marketplaces. This count excludes benefit plan designs that carriers are required by legislation to offer (e.g. catastrophic plans). Carriers in Maryland Health Connection will be allowed to rate by age, geography (the state is divided into four rating regions), and tobacco use.4

Carriers participating in the individual Marketplace must offer at least one silver and one gold level plan in the individual market outside of the Marketplace (if the carrier offers any plans outside of the Marketplace). The same applies for the small group market. Carriers must offer at least one catastrophic plan on the Marketplace if the carrier offers catastrophic plans outside the Marketplace. Carriers must also offer a child-only plan that is rated for child-only coverage in Individual markets inside and outside of the Marketplace.5

Carriers with state market share above a certain threshold must sell QHPs in Maryland Health Connection. The minimum participation threshold for carriers is $20 million in the small group market and $10 million in the individual market.

The MBHE board approved plan certification policies related to: service area designation; licensure and solvency; benefit design standards and review; marketing standards; review of rate changes; transparency and quality data; and access to essential community providers. The Marketplace will perform annual reviews of all participating carriers and provide performance reviews that highlight areas for improvement.6 Carriers will be required to complete corrective action plans based on the issues in the annual review, and recertification will occur biennially.7

In the first year, insurers will “self-define” network adequacy standards and submit provider data to the CRISP (Chesapeake Regional Information System for our Patients) Provider Information Management System. Insurance carriers will be required to participate in the Maryland Health Care Commission’s existing quality and performance evaluation system. In addition, carriers will be required to provide the MBHE with data each quarter regarding the number and type of providers available, the ability of enrollees to access services, and utilization and complaint data. The MBHE will accept Medicaid or Commercial accreditation and allow a one year grace period for non-accredited insurers to become accredited. In the second year of operation, the MBHE will reassess accreditation requirements, appropriate standardized network adequacy requirements, and other possible changes to plan management policies.

The Maryland Insurance Administration has approved premium rates for the individual market in 2014. Six carriers are participating in Maryland Health Connection’s individual market statewide,8 and all are offering coverage in the state’s largest rating area.9 Consumers will have a choice of 45 medical QHPs.10 Maryland’s Insurance Commissioner reduced the proposed premium rates by every insurance carrier in the individual market in Maryland, including reducing proposed increases for a majority of carriers by more than 50%. An analysis conducted by the Marketplace estimated that three out of four individuals and families expected to enroll for coverage through Maryland Health Connection will qualify for tax credits to reduce their health insurance rates.11

On September 17, 2013, the Maryland Insurance Administration approved health insurance policies and premium rates for plans to be sold through the Small Business Health Options Program (SHOP) for small employers.12 Thirteen carriers filed to sell health benefit plans in the small group market. The opening of the SHOP Marketplace has been delayed until April 2013 due to problems with the website. Small businesses with one to 50 full-time equivalent employees are eligible may enroll. Coverage begins on or after March 1, 2014. 13

Dental and Vision Plans:  In December 2012, the Board revised the interim plan management policies and procedures for adult and pediatric dental and vision plans.14 The MBHE anticipates requiring that all adult vision and dental coverage be offered through stand-alone plans with price disclosure to allow consumers to compare options. Pediatric vision coverage cannot be offered through stand-alone plans and must always be offered as part of the health benefit plan or as an additional benefit that can be purchased along with the health benefit plan. Pediatric dental coverage can be offered as part of the health benefit plan, as an additional benefit that can be purchased separately, or through a stand-alone plan.

Thirty-six of the 45 medical plans available on the individual Marketplace will include embedded pediatric dental benefits. Four carriers will be offering a stand-alone dental benefit. All stand-alone dental plans will be offered statewide.15 Stand-alone pediatric dental plans in Maryland Health Connection are required to use the same out-of-pocket maximums as those required on the Federally Facilitated Marketplace, set at $1,000 for one child and $2,000 for two or more children.16

Risk Adjustment, Reinsurance, and Risk Corridors: Maryland intends to use federal services to administer the state’s risk adjustment program but the MBHE will administer the state’s reinsurance program.

Consumer Assistance and Outreach: In April 2013, Maryland Health Connection launched its consumer assistance program. The Marketplace awarded $24 million in grant funds to six regional organizations to serve as Connector Entities. An estimated 300 new jobs will be created by the establishment of these Connectors, which will employ Navigators and In-person Assisters to help individuals and small employers through outreach and education, eligibility determinations, and enrollment into Medicaid and QHPs.

In addition to the six Connector entities, nearly 50 subcontractors will support the outreach, education, and enrollment efforts of Navigators and Assisters throughout the state. These organizations include health departments, hospitals, health clinics, community-based organizations, homeless shelters, workforce development centers and faith-based organizations. The intent of the regional approach is to ensure that all populations are reached including those with Limited English Proficiency, disabilities or those that may be in underserved communities.

Navigators must be trained and certified by Connector Entities, and will help counsel and enroll residents into QHPs and Medicaid through the Marketplace. In-person Assisters are not certified, but will be trained to provide information, assistance, and enrollment into Medicaid. Both Navigators and Assisters will provide information about eligibility requirements for federal premium subsidies and cost-sharing assistance, and assess eligibility requirements for Medicaid and CHIP. Navigators and Assisters will provide referrals to appropriate agencies, including the Attorney General’s Health Education and Advocacy Unit (HEAU) and the Maryland Insurance Administration (MIA) for applicants and enrollees with grievances, complaints, questions or the need for other social services through the Department of Health and Mental Hygiene and the Department of Human Resources (Social Services).17

There are separate Navigator programs for the small group and individual markets. SHOP Navigators are required to obtain a special license from the Insurance Commissioner and training/authorization from the MBHE. Outreach Entities are encouraged, but not required, to provide SHOP Marketplace Navigator services through direct employment or engagement with SHOP Navigators. Staff can be trained to serve as Navigators to both the individual and SHOP Marketplaces, but the funding for the two Marketplaces will be tracked separately.

Maryland will also have Certified Application Counselors (CACs), certified individuals who are employed by or volunteer with a sponsoring entity (which may be a community-based organization, health care provider, unit of state or local government, or other entities). CACs are subject to the same requirements, restrictions, conflict of interest rules, and oversight applicable to Navigators; are not compensated by the Marketplace, carriers, producers, or third-party administrators for consumer assistance services; do not impose fees for consumer assistance services; must disclose conflicts-of-interest; and must act in the best interest of the consumer. CACs may provide information to, and help consumers apply for and enroll in qualified health plans (QHPs) and qualified dental plans. They may also provide information on insurance affordability programs and help consumers determine eligibility for, and access, tax credits. They may provide uniform, factual, unbiased information approved by the state’s Medicaid program about all participating MCOs and providers, but may not express an assessment about, select, or counsel an applicant about an MCO.18

Licensed insurance producers can sell plans both inside and outside Maryland Health Connection, after receiving training and authorization by MHBE. Producers will receive instruction on the Marketplace, insurance plans, federal tax credits and cost-sharing reductions, and will be paid directly by carriers. MBHE will require carriers to retain information about policies and procedures used to determine producer compensation both inside and outside the Connection. The Maryland Insurance Administration and the MBHE will use this information to assess whether additional action is necessary beginning in the second year of operations. Maryland Health Connection estimates that 2,000 brokers will become authorized to sell plans through the Marketplace.19

As of September 27, 2013, 164 Navigators, 170 Assisters, and 1,236 caseworkers have been trained. As of October 3, 1,827 producers have been trained. More training sessions are scheduled.20

The Consolidated Service Center is the main entry point for questions related to Maryland Health Connection, Medicaid eligibility and enrollment, and any other question related to health insurance.21 The Center manages calls from individuals, employees, employers, Navigators, Assisters, and others.

The consumer portal for Maryland Health Connection, with the new branding strategy, first went live in August 2012. On October 1, 2013, it began accepting applications online. Maryland Health Connection offers a variety of resources on its website in Spanish, including fact sheets, FAQs, and videos. It is working to the make the full website available in Spanish. It also offers a Spanish version of its application for health coverage and financial assistance, and bi-lingual staff in call centers and Connector Entities.22

On September 3, 2013, Maryland Health Connection launched its advertising and outreach campaign. The integrated campaign includes advertising, social media and partnership strategies developed to provide consumers with the information they require to shop, compare and select health insurance through Maryland Health Connection. The statewide campaign includes television, radio, print advertising, out of-home and digital media. Central to the campaign is custom music that reinforces the key benefits of health coverage, including peace of mind, convenience, financial security and access to health care. The custom music has been produced in four musical genres: contemporary, Latin, country and urban.23

During the open enrollment period, Maryland Health Connection will partner with the Baltimore Ravens to help raise awareness of the importance of health insurance and the availability of coverage options. Research shows that 71 percent of the uninsured population in Maryland have watched, attended or listened to a Ravens game in the past 12 months. Maryland Health Connection will also partner with Giant Food and CVS Pharmacy throughout the state to provide information and literature on health insurance for consumers.24

Small Business Health Options Program (SHOP) Marketplace: In 2014 and 2015, the size of small employers in the SHOP Marketplace will be limited to an average of 50 or fewer employees. In addition, the individual and  SHOP Marketplaces plan to be merged in 2016. The SHOP will offer two coverage models for employers: an employer choice model in which the employer can select an insurer and allow employees to choose among all plans offered by that insurer; and an employee choice model in which the employer selects a metal tier and allows employees to select among all QHPs available within that tier. In order for an employer to purchase through the SHOP, current rules require 75% of employees to participate. Employees covered under other group health plans, enrolled in public programs, or for whom the coverage does not meet the federal definition of “affordable,” will not be included in the minimum participation calculation employers must have a minimum participation.25 However, the Policy and Government Relations Department is still working on regulations covering SHOP minimum participation, in addition to SHOP eligibility appeals and individual eligibility.26

Currently, third party administrators and brokers play a key role in the selection, purchase, and administration of insurance for small businesses.27 For this reason, Maryland Health Connectionis certifying entities to service the small group market on behalf of the Health Connection if they

In August 2013, Maryland Health Connection announced the opportunity for third-party administrators (TPAs) to become certified to participate in the administration of the SHOP Marketplace. Nearly 70 percent of small businesses in Maryland utilize TPAs to enroll in health benefits, and small employers rely on their services. TPAs will be able to help employers and employees compare and select qualified health plans (QHPs), administer enrollment and eligibility changes, and perform premium billing and collections. TPAs will be allowed to use Maryland Health Connections or the TPA’s systems to present and administer QHP information. Organizations that wish to become TPAs business partners must complete a certification process.28 They must also meet the criteria of the ACA and state requirements, adhere to a rigorous set of performance measure and service levels, and be subject to oversight by the Marketplace. These certified entities will receive compensation on a per-employee-per-month basis commensurate with what the market pays for services today, currently estimated at 0.5% to 1.0% of premiums. The Marketplace selected six organizations to be SHOP third-party administrator (TPA) partners for January 1, 2014.29

Financing: Once Maryland Health Connection is operational, it is authorized to collect fees or assessments from participating plans, though not to the extent that the fees create a competitive disadvantage with plans offered outside the Health Connection.

In September 2012, a subcontractor providing analytic support to the Joint Committee recommended a financing model that blends multiple approaches rather than relying on a single revenue source.30 An example hybrid financing approach might include a combination of revenue collected from the non-group, small group, and large group markets, providers, and cigarette sales. In December 2012, the Joint Committee  submitted a report to the Governor and General Assembly which included the following recommendations: the state should use a combination of at least two revenue streams; a transaction-based assessment on the whole non-group and small group market is preferable to an assessment applied only to plans inside Maryland Health Connection; and a broad-based assessment on the larger group market and/or an increase in the tobacco tax should be considered, while an assessment on hospitals should not be considered.

Basic Health Program (BHP): Maryland is considering establishing an optional coverage program available through the Affordable Care Act (ACA) which allows states to use federal funding to offer subsidized health insurance to adults with incomes between 139 and 200% of the federal poverty level (FPL) who would otherwise be eligible to purchase subsidized coverage through a Marketplace.  The DHMH, together with a subcontractor, completed an analysis of the effect of a BHP in Maryland and found that it may redirect funds away from Maryland Health Connection. In addition, the state would have to bear expenses related to program administration and quality monitoring. In February 2012, the MBHE Board agreed with the Department’s recommendation that a decision on the BHP be deferred pending availability of additional federal guidance and information about rates and fiscal risks to the state.31

Essential Health Benefits (EHB): The Affordable Care Act requires that all individual and small-group plans sold in a state, including those offered through the Marketplace, cover certain defined health benefits. The Maryland Health Care Reform Coordinating Council formed an advisory committee to assist in selecting the state’s EHB benchmark plan. On December 17, 2012, the Council reevaluated possible benchmark plans in light of new federal guidance and selected the state’s largest small group plan, CareFirst of Maryland (Blue Cross Blue Shield)-HMO HSA Open Access plan.  The Council also designated the GEHA Standard Option federal employee plan for the Maryland’s behavioral health benefit. Finally, the council designated the state’s current mandated habilitative services for individuals up age 19 and adopted the small group rehabilitative benefit for as the habilitative benefit for individuals over age 19.32

Marketplace Funding

The DHMH has received three federal grants: an Exchange Planning grant of $1 million; an Early Innovator grant of $6.2 million to develop a Marketplace IT infrastructure that could be replicated by other states; a Level One Establishment grant of $27 million to conduct data and policy analysis that will inform the technical and operational infrastructure of Maryland Health Connection and enable rapid implementation of the IT platform; and a Level Two Establishment Grant of $123 million to support continued policy development and consumer outreach, assistance, and education.33

In addition, Maryland, along with nine other states, is receiving technical assistance from the Robert Wood Johnson Foundation through the State Health Reform Assistance Network; this assistance includes help with setting up health insurance Marketplaces, expanding Medicaid to newly eligible populations, streamlining eligibility and enrollment systems, instituting insurance market reforms and using data to drive decisions.34

Next Steps

On December 7, 2012, Maryland received conditional approval from the U.S. Department of Health and Human Services (HHS) to establish a state-based Marketplace.35  The Maryland Health Connection Marketplace portal opened on October 1, 2013 and has begun enrolling qualified individuals and families into coverage. However, the opening of the SHOP has been delayed until April 2014.

Additional information about the Maryland Health Connection can be found at the state’s back office Marketplace website (Maryland Health Benefit Exchange) and its customer portal (Maryland Health Connection). You can also obtain information from Maryland Health Connection’s Facebook page, Twitter feed, or You Tube page.

Footnotes
  1. SB 182/ HB 166. (Chapter 2). Maryland Health Benefit Exchange Act of 2011. 

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  2. SB 372/ HB 433. Maryland Health Benefit Exchange Act of 2012. 

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  3. Maryland Health Benefit Exchange: Implementation Advisory Committee, Navigator Advisory Committee, Continuity of Care Advisory Committee, Plan Management Advisory Committee, Web-Based (WBE) Advisory Committee

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  4. Maryland Health Benefit Exchange. Carrier Reference Manual. June 2013.

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  5. Maryland Health Benefit Exchange. Carrier Reference Manual. June 2013.

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  6. Maryland Health Connection. “Exchange Implementation Advisory Committee.” October 18, 2012. 

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  7. Maryland Health Benefit Exchange. Carrier Reference Manual. June 2013.

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  8. Maryland Insurance Administration. 2014 Premium Rates for Maryland Health Connection: Individual Market.

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  9. Kaiser Family Foundation. An Early Look at Premiums and Insurer Participation in Health Insurance Marketplaces, 2014. Sept. 2013.

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  10. Maryland Health Benefit Exchange Board Meeting Minutes. Sept. 10, 2013.

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  11. Maryland Health Connection. Press Release: Health Insurance Premiums through Maryland Health Connection to be Among Lowest of 12 States with Approved or Proposed Rates.

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  12. Maryland Insurance Administration. 2014 Premium Rates for Maryland Health Connection: Small Group Market.

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  13. Maryland Health Connection. Press Release: Small Group Rates Approved for the SHOP Insurance Marketplace in Maryland. Sept. 17, 2013.

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  14. Maryland Health Benefit Exchange Carrier and Qualified Plan Certification. Interim Procedures- Additional Definitions; Dental and Vision Plan Certifications Carrier Requirements Related to Producer Compensation Data. Accessed January 7, 2012. 

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  15. Maryland Health Benefit Exchange Board Meeting Minutes. Sept. 10, 2013.

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  16. Maryland Health Benefit Exchange Board Meeting Minutes. March 12, 2013.

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  17. Maryland Health Connection. Press release: Lt. Governor Anthony Brown announces launch of health insurance consumer assistance program to ready residents and small employers for open enrollment through Maryland Health Connect ion.

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  18. Maryland Health Benefit Exchange.  Policy and Government Relations Update. October 8, 2013.

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  19. Maryland Health Connection. Press Release: Maryland Health Connection Announces Producer Authorization Training for Brokers to Sell Insurance Plans.

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  20. Maryland Health Benefit Exchange. Training Update. October 8, 2013.

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  21. Maryland Level Two Establishment Grant Application. July 12, 2012. 

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  22. Maryland Health Connection. Press Release October 25, 2013.

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  23. Maryland Health Connection. Press Release: Lt. Governor Brown and Maryland Health Connection Unveil Advertising and Outreach Campaign. Sept. 3, 2013.

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  24. Maryland Health Connection. Press Release: Lt. Governor Brown and Maryland Health Connection Unveil Advertising and Outreach Campaign. Sept. 3, 2013.

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  25. Maryland Health Benefit Exchange. Carrier Reference Manual. June 2013.

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  26. Maryland Health Benefit Exchange.  Policy and Government Relations Update. October 8, 2013.

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  27. Maryland Level Two Establishment Grant Application. July 12, 2012

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  28. Maryland Health Benefit Exchange. Press Release: Maryland Health Connection Announces Certification Program for Third-Pary Administrators.

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  29. Maryland Health Benefit Exchange. Plan and Partner Management Update. October 2013.

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  30. Joint Committee on Maryland Health Benefit Exchange Financing. “Options for Financing the Maryland Health Benefit Exchange: Report and Recommendations to the Governor and Genreal Assembly.” December 1, 2012. 

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  31. Maryland Health Benefits Exchange Board Meeting Minutes, February 14, 2012. 

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  32. Maryland Health Care Reform website. “Meeting: HCRCC Selects Essential Health Benefits Benchmark. December 19, 2012.” Access January 3, 2013. 

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  33. Maryland Health Insurance Marketplace Grants Awards List.

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  34. Robert Wood Johnson Foundation. “RWJF Seeks Coverage of 95 Percent of All Americans by 2020.” May 6, 2011.  

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  35. Letter from Secretary Sebelius to Governor O’Malley. December 7, 2012. 

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