April 20, 2014

Multi-State Plan Proposed Rule Released

On Nov. 30, 2012, a few weeks after the announcement of government sponsorship of multi-state plans took existing insurers and CO-OP developers by surprise, the Office of Personnel Management (OPM) published the proposed rule on these plans. Under these multi-state plans, health insurance operated under contract with the federal government will be available to consumers in every state through state insurance exchanges. The impetus behind these plans is the belief that a government sponsored multi-state plan will increase competition and lead to more competitive pricing in health insurance markets.

According to OPM, there are five primary objectives of the proposed rule:

  1. Ensure the choice of at least two high-quality products to consumers participating in each exchange
  2. Promote competition in the health insurance market
  3. Offer plans from the same issuer to families or small business that may reside or operate in more than one state
  4. Provide strong, effective contractual oversight of the multi-state plans
  5. Work cooperatively with states and the Department of Health and Human Services to ensure a “level playing field.”

This last objective is of particular concern to private insurers. The Affordable Care Act (ACA) provisions pertaining to multi-state plans do not specify how these plans will comply, if at all, with requirements under various state laws. Private insurers worry that if state laws do not apply, these multi-state plans may have an unfair competitive advantage over other insurers who are subject to state-specific requirements. While the proposed rule includes the ACA directive that the multi-state plans be governed by all state and federal laws that apply to qualified health plans, it also carves out an exception “to the extent any such laws are inconsistent with these regulations, OPM guidance, or OPM’s contracts.”

The comment period for this rule will be open from Dec. 5, 2012 through Jan. 4, 2013, and OPM has stated that the final rule will be released next year.


About the Author

Nita Garg, Health Care Attorney, Barnes Thornburg, Law firm
Staff Attorney

Nita Garg is an associate in Barnes & Thornburg LLP’s Chicago office and a member of the firm’s Healthcare Department. Ms. Garg assists clients with healthcare issues, including physician employment, physician-hospital contracting, Medicare and Medicaid reimbursement, and various state and federal regulatory matters, including fraud and abuse and HIPAA. 


Boost: AJAX core statistics

Legal Disclaimer

You are responsible for reading, understanding and agreeing to the National Law Review's (NLR’s) and the National Law Forum LLC's  Terms of Use and Privacy Policy before using the National Law Review website. The National Law Review is a free to use, no-log in database of legal and business articles. The content and links on are intended for general information purposes only. Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. No attorney-client or confidential relationship is formed by the transmission of information between you and the National Law Review website or any of the law firms, attorneys or other professionals or organizations who include content on the National Law Review website. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor.  

Some states have laws and ethical rules regarding solicitation and advertisement practices by attorneys and/or other professionals. The National Law Review is not a law firm nor is  intended to be  a referral service for attorneys and/or other professionals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional.  NLR does not answer legal questions nor will we refer you to an attorney or other professional if you request such information from us. 

Under certain state laws the following st