On February 15, 2017, CMS issued a proposed rule which the Trump administration contends will reform and stabilize the individual and small group health insurance market exchanges created pursuant to the Affordable Care Act (ACA). The proposed rule would make changes relating to the open enrollment period, special enrollment periods, guaranteed availability standards, network adequacy rules, essential community provider requirements, and actuarial value requirements.
CMS Acting Administrator, Dr. Patrick Conway, indicated the proposed reforms are intended to help protect individuals enrolled in the individual and small group health insurance markets while future repeal and replace reforms are debated. CMS further states that the proposed revisions are in response to the recent exit of several issuers from the healthcare exchanges and the increasing rates for consumers purchasing plans through the exchanges. Comments on the proposed rule are due on March 7, 2017.
The proposed changes include the following:
Shortening of Open Enrollment Period
CMS proposes shortening the individual market annual open enrollment period to better align it with open enrollment periods for Medicare and employer-based coverage. Accordingly, for the 2018 coverage year, CMS proposes an open enrollment period of November 17, 2017 to December 15, 2017.
CMS indicates that it intends to conduct extensive outreach to ensure that all consumers are aware of the change and have the opportunity to enroll in coverage within the shorter timeframe.
Changes to Special Enrollment Pre-Enrollment Verification Process
The proposed rule expands the pre-enrollment verification of eligibility process for individuals who newly enroll through special enrollment periods using the HealthCare.gov platform. CMS notes that special enrollment periods are a longstanding feature of employer-sponsored coverage and exist to ensure that people who lose healthcare coverage during the year or experience a qualifying event, such as marriage or the birth or adoption of a child, have the opportunity to enroll in new coverage or make changes to existing coverage.
CMS’s past practice, in many cases, was to permit individuals seeking coverage through special enrollment periods on the exchanges to self-attest to their eligibility for special enrollment periods and to enroll in coverage without further verification of their eligibility or without submitting proof of prior coverage. CMS seeks to change the pre-enrollment verification process in an effort to prevent potential abuse by individuals who seek to enroll in coverage through a special enrollment period only after realizing a need for healthcare services.
The expanded pre-enrollment verification process would begin in June 2017 and would require HHS to conduct pre-enrollment verification of eligibility for exchange coverage for all categories of special enrollment periods for all new consumers in all States served by the HealthCare.gov platform.
CMS noted that the impact these additional verification measures may have on the overall risk pool is complex. Potentially, healthier, less motivated individuals may be deterred from enrolling due to the additional barriers, which could negatively impact the risk pool. Accordingly, CMS is seeking comment on, among other things, whether it should retain a small percentage of enrollees outside the pre-enrollment verification process to study the impact on the risk pool of these additional measures.
Changes to Guaranteed Availability Requirements
CMS also proposes to change guaranteed availability requirements to allow issuers to collect premiums for prior unpaid coverage before enrolling an individual in the next year’s plan with the same issuer. Said differently, this change would generally permit an issuer to require a policyholder whose coverage was terminated for non-payment of premiums to pay past due premiums owed to that issuer in order to resume coverage from the issuer. As a result of this change, CMS hopes to discourage individuals from only paying premiums when in need of healthcare services and to reduce potential gaming of the system.
Increase in Flexibility for Actuarial Value Variations for Bronze, Gold, and Platinum Plans
CMS proposes to increase the de minimis range for actuarial values used to determine the metal levels of coverage for bronze, gold, and platinum plans. This proposed change is intended to provide issuers greater flexibility in designing new plans and to provide additional options for issuers to keep cost sharing the same from year to year. CMS is not proposing modifications to the de minimis range for the silver plan variations.
Deference to States in Determining Network Adequacy
Under the proposed rule, States would play a greater role in determining network adequacy. To be certified as a Qualified Health Plan (QHP), health and dental plan issuers must maintain a network that is sufficient in the number and types of providers, including providers that specialize in mental health and substance abuse services, to assure that all services are accessible without unreasonable delay.
Under the proposed rule, CMS would rely on the State’s review of network adequacy in States with the authority and means to assess issuer network adequacy.
Changes to QHP Certification Calendar
CMS intends to release a revised proposed timeline for the QHP certification and rate review process for plan year 2018. The revised timeline would provide issuers with additional time to implement proposed changes that are finalized prior to the 2018 coverage year.
CMS’s press release is available here. Additionally, the proposed rule is available here.
