The U.S. Department of Health and Human Services has notified the country's territories about exemptions granted to their health insurers from the requirements of the Affordable Care Act, or Obamacare.

In a letter sent to the U.S. territories, signed by Centers for Medicare and Medicaid Services' Administrator Marilyn Tavenner, the department stated the insurance companies within the territories are not required to follow certain requirements listed in the legislation since they are not classified as a "state." According to The Hill, these territories include American Samoa, Guam, the Northern Mariana Islands and Puerto Rico.

In one copy of the letter sent to the Office of the Lieutenant Governor of the U.S. Virgin Islands, Tavenner wrote she wanted to clarify an issue that was raised "on a number of occasions" by the territories. Tavenner acknowledged representatives of the U.S. territories were concerned by the language in the ACA and how it could undermine the "stability" of the territories' health insurance markets, specifically the usage of the word "state."

"After a careful review of this situation and the relevant statutory language, HHS has determined that the new provisions of the [Public Health Service] Act in title I (of the ACA) are appropriately governed by the definition of 'state' set forth in that title, and therefore that these new provisions do not apply to the territories," said Tavenner.

According to Tavenner, this means the usual ACA requirements such as guaranteed availability, community rating, medical loss ratio and "essential" health benefits outlined in several sections do not have to apply to health insurers from the territories.

Tavenner added that the CMS will help identify and affirm the interpretations of the ACA and eliminate text that presents inconsistencies between "state" and "territory."

There is a consequence with the exemptions for the territories' health insurers. The CMS administrator noted all unspent grant funding must be returned to the CMS. Tavenner stated, due to the latest interpretation of ACA, the territories are no longer eligible to utilize such funds.

According to government figures, 8 million people have signed up for insurance either on Healthcare.gov or through a U.S. state's exchange websites. The Commonwealth Fund reported the ACA led to 20 million Americans gaining health insurance. The report noted 7.8 million were people under 26 years old who are covered by their parents' plans, eight million applied through the market exchanges and five million purchased insurance directly from an insurer.

HHS says the ACA can provide up to 10.2 million uninsured Latinos with affordable health insurance coverage. As Latin Post reported, HHS received a lower than projected number of applicants that reported their race or ethnicity as "Latino," which represented 10.7 percent of individuals enrolled. Whites represented the largest proportion with 62.9 percent.

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