42 U.S.C. § 18052 — Waiver for State innovation

(a) Application A state can apply to waive some of the requirements listed below, for plan years starting on or after January 1, 2017. The application must be filed the way the Secretary requires, include a full description of the state's alternative law and plan, a 10-year budget plan that does not cost the federal government more money, and proof the state passed the law required under subsection (b). The waivable requirements, for plan years from January 1, 2014 on, are: Part A of this subchapter, Part B of this subchapter, the cost-sharing reduction rule in section 18071, and three tax-code sections, the premium tax credit under section 36B, the employer mandate under section 4980H, and the individual mandate under section 5000A. If a waiver's structure means individuals, small employers, or small businesses in that state would lose out on tax credits, cost-sharing reductions, or small-business credits they would otherwise get, the Secretary must instead pay the state an equivalent lump sum, the total amount those credits and reductions would have cost, to help run the state's alternative plan. The Secretary sets this amount every year, based on other states' Exchange experience. Within 180 days of March 23, 2010, the Secretary must write regulations covering: state-level public notice, comment, and hearings before applying; a process ensuring the application discloses which laws the state wants waived and how the state will comply with subsection (b); federal-level public notice and comment after the Secretary gets the application, without piling on requirements beyond the Administrative Procedures Act or being unreasonably burdensome; periodic state reports on how the waiver is going; and periodic Secretary reviews of the waiver program. The Secretary must report to Congress each year on waiver applications and actions taken. The Secretary must also build one coordinated process for this waiver and for existing waiver processes under Medicare, Medicaid, and CHIP, and any other related federal health law, so a state can file one combined application covering all of them. "Secretary" here means the HHS Secretary for waivers touching the Part A, Part B, and cost-sharing-reduction provisions, and the Treasury Secretary for waivers touching the tax-code provisions. (b) Granting of waivers The Secretary can only grant a waiver if the state's plan will: provide coverage at least as comprehensive as this law's essential benefits and Exchange coverage, certified by CMS's actuary using sufficient state and comparable-state data; provide cost protections against big out-of-pocket costs at least as good as this law's; cover at least as many residents as this law would; and not add to the federal deficit. The state must have passed a law authorizing the state actions under the waiver, including how it will run its alternative plan. A state can later repeal that law, which ends the waiver. (c) Scope of waiver The Secretary decides exactly how much of a requirement to waive. The Secretary cannot waive any federal law or rule that is not within the Secretary's own authority to begin with. (d) Determinations by Secretary The Secretary must decide on an application within 180 days of receiving it. If granted, the Secretary must tell the state the waiver's terms and when it starts. If denied, the Secretary must tell the state and the relevant congressional committees, and explain why. (e) Term of waiver A waiver lasts at most 5 years, unless the state asks to continue it. That renewal request is automatically granted unless, within 90 days, the Secretary either denies it in writing or asks the state in writing for more information needed to decide.