Health insurers and their trade associations, providers, employer groups and unions are sounding an alarm over the federal government's recent suggestion that it may stop automatically re-enrolling certain low-income people in Affordable Care Act exchange plans.
The CMS in January asked for feedback on whether it should eliminate or reduce tax credits for subsidized exchange enrollees who receive $0 premium plans unless they actively re-enroll in coverage during open enrollment. The agency said the change could reduce the risk that it pays out premium tax credits to ineligible people.
The agency pitched the idea in the 2021 proposed rule that outlines standards governing ACA-compliant plans. In comments due Monday on the proposed rule, health insurers and providers said such a change would cause widespread confusion and result in more uninsured people.
"The policy discussed by CMS would sow significant confusion and lead to loss of coverage unless consumers take counterintuitive steps. This proposal has a disproportionate impact on low-income consumers. What's most disquieting is that that seems to be the point," said Margaret Murray, CEO of the Association for Community Affiliated Plans, which represents 74 not-for-profit and community-based safety net health plans.
At least 1.8 million people were automatically re-enrolled in exchange coverage in 2019, including 270,000 who paid no premiums, according to the HHS.
California-based integrated system and insurer Kaiser Permanente explained that such "discriminatory treatment" against low-income customers would require health insurers to invest more in outreach, education and member support to minimize confusion and resolve delinquencies for people who wouldn't be expecting a bill.
UPMC Health Plan commented that a better way to encourage people to take a proactive role in selecting coverage would be to restore "significantly reduced marketing and outreach funding that previously supported navigators and other community assistance resources." The Trump administration slashed the budget for outreach by 90% in 2018.
The Federation of American Hospitals questioned the CMS' authority to end automatic re-enrollment for certain people.
"The ACA does not permit the exchanges to consider information unrelated to APTC eligibility in making APTC determinations," FAH wrote. "Thus, CMS cannot require that exchanges reduce or eliminate APTCs based on whether an individual is undergoing automatic re-enrollment."
While most commenters slammed the proposal to end automatic re-enrollment, other changes included in the proposed rule received mixed reactions. Health insurers and employer groups supported the CMS' proposal to allow insurers to stop drug manufacturer coupons from going toward a patient's annual limit on out-of-pocket costs even when a generic drug isn't available.
The Business Group on Health said in a comment that employers need to be able to deploy so-called copay accumulator programs to encourage the use of lower-cost drugs.
"Limiting use of these tools would disrupt current plan designs and hamper plan sponsors' efforts to tailor their plan designs to their specific cost concerns, which include lowering overall premiums as well as participant cost-sharing," it wrote.
On the flipside, the Service Employees International Union, which represents 2 million workers, said people would be subjected to unaffordable prescription drug prices without drug manufacturer coupons to help defray the cost.
"Exorbitant prescription drug prices have led one in five consumers to postpone paying nonmedical bills and one in three consumers to use credit cards more often or spend less on groceries. The proposed change risks rendering the requirement for coverage of prescription drugs meaningless, and we urge you to withdraw it," the union wrote.
The proposed rule also offered examples of how health insurers could introduce value-based insurance design to their exchange plans but said value-based plans wouldn't be preferentially displayed on HealthCare.gov. Some groups urged the CMS rethink its stance against incentivizing the adoption of value-based plans.
The Alliance of Community Health Plans, for example, asked the CMS to create new policies to educate consumers about value-based insurance plans and provide preferential display for plans meeting a minimum set of value-based insurance design principles.
"Without such attention to the value-based insurance plan designs, consumers will likely be unable to properly evaluate these plans over traditional metallic plans and determine their individual value," the ACHP wrote.
However, America's Health Insurance Plans, one of the industry's largest lobbying groups, said designating certain plans as "value-based" could hinder plans that don't conform to certification standards and introduce operational challenges to the exchanges.
"There is no obvious and meaningful way to identify a V-BID plan as such on an exchange website," AHIP wrote.
Other changes included in the proposed rule were very technical. They included numerous changes to the risk adjustment model and a few tweaks to the medical-loss ratio calculation. Many insurers supported the continued transition to recalibrating the risk-adjustment model using enrollee-level data. But New York-based Emblem Health raised concerns about the sheer number of changes to the risk-adjustment model being pitched, which it said could cause market distortions because not all plans have enough resources to make sure providers are accurately reporting patients' conditions.
"Although CMS promises to limit the number of HCC changes in future years, we strongly suggest it reduce the instability in the model for 2021, which is likely to further increase the market power of highly capitalized plans to the detriment of local insurers that are spurring innovation and making markets more competitive," Emblem Health wrote.
While insurers generally supported including wellness incentives in the medical loss ratio calculation, some worried about a change that would require them to deduct prescription drug rebates and other price concessions in the MLR claims calculation. AHIP asked the CMS to make some changes to its proposal to avoid unintentionally double-counting rebates and price concessions retained by insurers, and asked the CMS to delay the change until 2022.
