The CMS announced a final rule on Thursday that it said would promote lower premiums and value-based plan designs while ensuring federal premium subsidies are not spent on ineligible people.
Separately, the agency also announced it is giving health plans a one-week extension to finalize 2021 exchange plan applications so they can better collect and analyze data related to the effects of COVID-19 so as to set accurate premium rates.
Under the final rule, called the HHS Notice of Benefit and Payment Parameters for 2021, the CMS said it is moving forward with changes that clarify when exchanges need to re-determine a plan member's eligibility for financial help. This will reduce the risk that subsidies go to ineligible people, it said. The agency said exchanges do not need to re-determine subsidy eligibility when ending coverage for someone who has been found to be deceased or dually enrolled in other qualifying coverage, such as Medicare or Medicaid.
To "safeguard taxpayer dollars," the CMS will also begin requiring states to report any additional health benefits that they require above and beyond the 10 essential health benefits. States are required to defray the cost of those extra benefits, it said.
Meanwhile, the agency is backing away from making any changes to the automatic re-enrollment process for Affordable Care Act exchange enrollees. Health insurers and providers had railed against the CMS' suggestion that it would effectively stop automatically re-enrolling low-income exchange customers that receive full premium subsidies.
But is moving forward with a proposal to allow insurers to exclude drug manufacturer coupons for prescription medications from counting toward a plan member's annual out-of-pocket limit. The agency had finalized that policy in 2020, but walked it back in later guidance.
The CMS is also finalizing information on how insurers can implement value-based insurance design to encourage members to seek high-value care. It will not display the value-based plans preferentially on HealthCare.gov, however.
It is making some changes to special enrollment periods that it said would improve access to coverage. For example, under certain special enrollment periods, the CMS is shortening the time between when a customer selects a health plan and that plan's effective date, starting in January 2022. The agency is also allowing exchange members and their dependents who are enrolled in silver plans and become ineligible for cost-sharing subsidies to change metal levels.
Among other changes, insurers will be allowed to count wellness program incentives as quality improvement activities to be used in the calculation of their individual market medical loss ratios. Under the MLR rule, insurers in the individual market are required to spend at least 80% of premium revenue on medical care and quality improvement.
Additionally, the CMS is finalizing a proposal to require insurers to deduct prescription drug rebates and other discounts from its incurred claims for MLR reporting purposes. It will require insurers to deduct those discounts not only when they are received by the insurer, but also when they insurers' pharmacy benefit manager.
The agency also made some technical changes to the risk-adjustment process that it said would increase market stability.
Finally, it announced it will maintain the current exchange user fee rates of 3% and 2.5% of monthly premiums for the federal exchange and state-based exchange on the federal platform, respectively. And, as it does each year, the CMS is also updating the maximum annual limits on cost-sharing. In 2021, the limits will rise 4.9% to $8,550 for individual coverage and $17,100 for family coverage.
