CMS Finalizes 2017 ACA Marketplace Plan Requirements

In March, the Centers for Medicare and Medicaid Services published its annual Notice of Benefit and Payment Parameters, a final rule that governs participation in the Affordable Care Act (ACA) health insurance marketplaces for 2017. Major provisions of the rule include:

• Qualified health plan (QHP) payment parameters were changed, including recalibrating the risk adjustment formula using most recent data and establishing separate growth rates for traditional and specialty drugs and medical/surgical expenditures; establishing a lower default risk adjustment charge for small insurers; increasing the default risk adjustment charge; updating the premium adjustment percentage; and setting the 2017 maximum annual limitation on cost sharing for $7,150 for individuals and $14,300 for families.

• “Surprise” bills that occur when out-of-network services are performed at an in-network facility are limited by requiring QHP insurers to count such out-of-pocket expenses toward an enrollee’s out-of-pocket maximum unless notification requirements were met (beginning in 2018).

• Continuity of care protections were established to require QHP insurers to provide prior written notice to enrollees of discontinuation of a provider and, in cases in which a provider is terminated without cause, allow an affected enrollee to continue treatment at in-network cost-sharing rates, subject to certain parameters.

• Ratings will be included on HealthCare.gov related to each QHP’s relative network coverage.

• QHP insurers will be allowed to offer plans with standardized cost-sharing options to facilitate consumer comparison of plans.

• QHP insurers will be required to verify that contracted hospitals with more than 50 beds either work with a patient safety organization, or implement an evidence-based initiative to improve healthcare quality through data collection and analysis of patient safety events to reduce all-cause preventable harm, prevent readmissions and improve care coordination.

• For 2017 and 2018, open enrollment will run from November 1 of the previous year through January 31 of the coverage year. In 2019 and beyond, open enrollment will run from November 1 through December 15 of the year preceding coverage.

The final rule also addresses Navigators’ post-enrollment functions, Small Business Health Options Program plans, third-party cost-sharing payments, student health insurance coverage, the rate review program, the medical loss ratio program, eligibility and enrollment, exemptions and appeals, user fees for federally facilitated exchanges, and codification of a new “Stage-based Exchange on the Federal Platform” model.

In addition, CMS released the following guidance documents: the final Annual Letter to Insurers, which provides operational and technical guidance to insurers seeking to offer QHPs in the federally facilitated marketplaces or the federally facilitated Small Business Health Options programs; a bulletin on Timing of Submission and Posting of Rate Filing Justifications for the 2016 filing year for single risk pool coverage; frequently asked questions on the recently enacted moratorium on the ACA health insurance provider fee; and guidance on an additional extension of a transitional policy for certain non-grandfathered individual and small group health policies that are not compliant with specific ACA standards.