On December 28, 2021, HHS released a proposed rule governing plans issued in the Patient Protection and Affordable Care Act (ACA) marketplaces beginning with the 2023 plan year (the Proposed Rule).
Among other changes to the rules in effect for the 2022 plan year, the Proposed Rule would implement the following changes on applicable ACA marketplace plans:

• CMS would conduct network adequacy reviews for all federally-facilitated marketplace (FFM) states other than in states that adhere to standards at least as strict as the federal network adequacy standards and elect to perform their own reviews. The federal standard would be based on time, distance, and appointment wait standards, and reviews would be conducted during the Qualified Health Plan certification process;

• Issuers unable to meet the standard would be permitted to submit a justification explaining why the standards are not being met, what they are doing in order to meet them, and how their customers will be protected in the meantime. HHS would review the submitted justifications to determine whether the variance(s) from the standards are reasonable based on circumstances, such as the local availability of providers and variables reflected in local patterns of care, and whether offering the plan through the federally-facilitated exchange would be in the interest of qualified individuals and employers;

• CMS would require issuers in FFMs and in State-based Marketplaces on the Federal Platform to offer standardized plan options at every product network type, plan level, and service area in which they offer non-standardized plan options beginning in plan year 2023. A non-standardized plan is one with variation in the cost-sharing structure that may make it difficult to compare in terms of total expected out-of-pocket costs (including premiums) against plans with standardized cost-sharing structures;

• CMS would prohibit marketplaces, issuers, agents, and brokers from discriminating based on sexual orientation and gender identity, characteristics that had been protected under the ACA until the issuance of a 2020 HHS rule;

• The Proposed Rule would refine the Essential Health Benefits (EHB) nondiscrimination policy by providing examples illustrating presumptively discriminatory plan designs that violate the prohibition against discriminating based on age, health conditions, and sociodemographic factors. Under the Proposed Rule, one example of a presumptively discriminatory EHB design provided by HHS would be the inclusion of an age-limit for coverage of hearing aids, which would violate the prohibition on age discrimination in the coverage of EHBs;

• The Proposed Rule would relax pre-enrollment Special Enrollment Period (SEP) verification so that verification would be required only for loss of minimum essential coverage, not for any other SEP type;

• The Proposed Rule would update Quality Improvement Strategy (QIS) standards to require issuers to address health and health care disparities as part of their QIS;

• The Proposed Rule would raise the Essential Community Provider threshold from 20% to 35%;

• The Proposed Rule would make several changes to the risk adjustment models used in the ACA marketplace, including adding a two-stage weighted approach for the adult and child models; removing the current severity illness factors from the adult models and adding hierarchical condition category (HCC) count model specifications to the adult and child models; and replacing the current enrollment duration factors with HCC-contingent enrollment duration factors; and

• The Proposed Rule would prohibit the inclusion of overhead attributable to Quality Improvement Activity expenses for purposes of calculating the Medical Loss Ratio.

The full text of the Proposed Rule is available here.