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Text of CMS Letter to Puerto Rico and other U.S. Territories on the Definition of 'State' for Purposes of ACA (PDF)
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS] Link to more items from this source
[Official Guidance]
July 17, 2014
"Currently, the Department uses the existing Public Health Service Act (PHS Act) definition of 'state' for new PHS Act requirements and funding opportunities included in title I of the [ACA]. Under this definition, the new market reforms in the PHS Act apply to the territories. We have been informed by representatives of the territories that this interpretation is undermining the stability of the territories' health insurance markets.... After a careful review of this situation and the relevant statutory language, HHS has determined that the new provisions of the PHS Act enacted in title I are appropriately governed by the definition of 'state' set forth in that title ... [T]he following [ACA] requirements will not apply to individual or group health insurance issuers in the U.S. territories: guaranteed availability ... community rating ... single risk pool ... rate review ... medical loss ratio ... and essential health benefits[.] " [Identical letters also sent to Northern Mariana Islands, Guam, American Samoa and U.S Virgin Islands.

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