Standards and procedures governing Exchange authority to grant exemptions and recognize or designate minimum essential coverage (MEC). Consolidates eligibility categories, duration, verification, redetermination, MEC designation/recognition, and related operational rules.
Exchanges must determine eligibility and grant certificates of exemption when statutory and regulatory standards are met for at least one day of a month, except as specified in §155.605(g) where different duration rules apply. (§155.605(a)). Exchanges will not issue certificates for certain categories (lack of affordable coverage, household income below filing threshold, not lawfully present, short coverage gaps) which are available only through the tax filing process; some hardship exemptions (§155.605(g)(3) and (5)) are also IRS-administered.
Except as noted, an applicant must submit a new Exchange application each calendar year to be considered for an exemption for that year. Exceptions exist for religious conscience and membership in an Indian tribe (expected to persist year-to-year) and hardship exemptions that may span months or be provided retrospectively. Exchanges may send notices to applicants reaching milestone ages (e.g., religious exemption applicants upon reaching age 21) to prompt re-application when required. (§155.605(b),(c),(f),(g),(26)
Religious conscience exemptions: Exchange must grant for any month an applicant is a member/adherent of a recognized sect described in section 1402(g)(1) of the Code. Duration: continuing basis until the month after the individual's 21st birthday or until the individual reports no longer meeting criteria. Exemption may be provided prospectively or retrospectively. (§155.605(c))
Health care sharing ministry exemptions: Exchange must determine eligibility for months the applicant is a member of a qualifying health care sharing ministry as defined by statute. These exemptions are available only retrospectively; HHS will maintain a process to identify and list valid ministries and sponsors may apply for recognition. (§155.605(d); §155.615(c))
Incarceration exemptions: Exchange must determine eligibility for any month the individual meets the statutory incarceration standard; such exemptions are available only retrospectively. Verification follows the same process used in §155.315(e). (§155.605(e); §155.615(d))
Tribal membership and I/T/U access: Exchange must grant exemptions for members of an Indian tribe for any month they meet the statutory definition; duration is continuing until the individual reports loss of status. Additionally, an exemption exists for Indians eligible for services through Indian health care providers or IHS (per 42 CFR 447.50 and 25 U.S.C. 1680c), with the same verification procedures and continuing duration until status changes. (§155.605(f); §155.605(g)(6); §155.615(e),(f)(3))
Hardship exemptions (§155.605(g)): General hardship (§g)(1) is granted at minimum for the month before, the month(s) during, and the month after the hardship event (Exchanges may extend as appropriate) when financial or domestic circumstances (including unexpected events) cause significant unexpected essential expenses, risk of serious deprivation, or similar circumstances preventing obtaining coverage. (§155.605(g)(1); chunk 38)
Lack of affordable coverage based on projected income (§155.605(g)(2)): Exchange must determine eligibility for months when projected annual household income indicates inability to afford coverage per statutory standards. Determination uses projected income, considers only eligible employer-sponsored plans that meet minimum value (§156.145), treats tobacco-related wellness incentives as not earned for affordability calculations, specifies methods to compute required contribution for employees and family members, requires application prior to the last date an individual could enroll in a QHP for the months requested, and provides the exemption prospectively for all remaining months in the coverage year notwithstanding changes in circumstances. Mid-year redeterminations are not required for this exemption; Exchanges will not require reporting or send periodic reminders for these recipients. (§155.605(g)(2); §155.620)
Filing-threshold and Medicaid expansion gap hardships (§155.605(g)(3),(4)): The IRS may administer the filing-threshold exemption for certain taxpayers who filed to obtain a tax benefit. Exchanges must grant an exemption for a calendar year if the applicant was determined ineligible for Medicaid solely due to a State not expanding under section 2001(a). Consideration of limiting to those not eligible for advance premium tax credits was solicited. (§155.605(g)(3),(4))
Self-only employer coverage aggregate cost hardship (§155.605(g)(5)): The IRS may administer the exemption when family members each have affordable self-only employer coverage but aggregate employer costs exceed 8% of household income. (§155.605(g)(5))
Duration and retrospective applications: Exchanges may provide certain exemptions prospectively or retrospectively as specified. For hardship exemptions under §155.605(g)(1), Exchange will accept applications only within three calendar years after the attested hardship month(s); other retrospective hardship exemptions may be available after calendar year-end as specified. Exchanges must permit paper applications via mail at minimum until October 15, 2014. (§155.610; §155.615(h); §155.610(d)(3); chunk 62)
Verification principles (§155.615): Exchanges must use existing verified information collected for QHP enrollment and affordability determinations when still applicable, and avoid duplicative verification. Verification processes for exemptions cross-reference subpart D procedures where appropriate (e.g., for affordability/hardship verifications, employer-sponsored plan eligibility, tribal membership). For some exemptions, attestations are accepted with limited verification (health care sharing ministries) combined with HHS-maintained listings. (§155.615; chunk 55; chunk 62; chunk 165)
Verification for specific categories: religious membership must be recognizable by SSA under section 1402(g)(1); if not reasonably compatible with other records, inconsistency procedures apply; if sect not recognized, Exchange provides information on pursuing recognition and determines applicant ineligible until approved. Health care sharing ministry attestation is generally accepted and Exchange verifies the ministry via HHS data; if ministry is unknown, provide guidance and deem ineligible until HHS recognition. Incarceration and tribal membership verifications follow §155.315(e) and §155.350(c) processes respectively. (§155.615(b)-(e); chunks 162-165)
Inability to verify and inconsistency process (§155.615(g)-(h)): When Exchange cannot verify required information (including electronic data unavailability per §155.315(f)), it must attempt to resolve clerical causes, contact filer to confirm, then provide notice and allow a 90-day period to submit satisfactory documentary evidence (aligned with QHP eligibility timelines). The Exchange may extend this period for good-faith efforts. During the verification period, Exchange must not grant the exemption. If verification remains unsuccessful after the period, Exchange will determine eligibility based on available data unless exception under paragraph (h) applies. Paragraph (h) allows case-by-case exceptions to accept attestations when documentation does not exist or is not reasonably available, with an applicant explanation. (§155.615(g)-(h); chunks 74, 79, 166-167)
Operational rules and notices: Exchanges will notify individuals determined eligible to retain the certificate and records demonstrating qualification for the exemption. Exchanges must validate Social Security numbers for exemption applicants consistent with rules in §155.315(b). Exchanges should provide clear consumer information about exemptions and required documentation. (§155.610(j)(1); §155.615(k); chunk 62; chunk 74)
MEC designation and recognition (§156.602, §156.604): Certain coverages are designated as MEC (e.g., Medicare Part A, Medicaid, CHIP, TRICARE, refugee medical assistance, Medicare Advantage; self-funded student health plans and state high-risk pools are temporarily designated for plan/policy years beginning on or before December 31, 2014). Foreign health coverage and AmeriCorps were not designated but may seek recognition via §156.604. Sponsors seeking recognition must certify and submit documentation demonstrating substantial compliance with Title I requirements applicable to non-grandfathered individual coverage; CMS focuses on coverage extent and consumer protections rather than sponsor type. Recognized MEC sponsors must provide IRS §6055 reporting and furnish statements to enrollees; recognized sponsors must notify enrollees that the plan is recognized as MEC. (§156.602; §156.604; chunks 4, 11, 97-103, 127-128, 114)
Application burden and process: Sponsors submit electronic requests to CMS with certifications and supporting plan documentation; CMS estimates minimal administrative burden (example estimate provided). HHS may revoke recognition of a health care sharing ministry if it no longer meets statutory standards. (§156.604; chunk 127-128; §155.615(c)(2))
Exchange scope and limits: Exchanges will grant certificates only for categories specified in §155.605 and per the division of duties with the IRS; Exchanges should avoid duplicative verification and may reuse applicable enrollment and affordability data for exemption determinations. (§155.605 preamble and §155.610; chunks 24, 55, 62, 138)