The federal government on Friday proposed changes to standards governing ACA-compliant health plans sold on the exchanges in 2021, several of which aim to ensure the CMS doesn't provide subsidies to ineligible people.
The CMS asked for feedback on whether it should end automatic re-enrollment for low-income exchange enrollees who receive $0 premium plans with tax credits. The agency requested comment on whether it should discontinue or reduce those enrollees' advanced premium tax credits for the next year unless they actively update their application during open enrollment.
That change would reduce the risk that ineligible enrollees receive federal subsidies, the CMS said.
"We remain concerned that automatic re-enrollment may lead to incorrect expenditures of (advanced premium tax credit), some of which cannot be recovered through the reconciliation process due to statutory caps. We believe that there may be particular risk associated with enrollees who are automatically re-enrolled with APTC that cover the entire plan premium, since such enrollees do not need to make payments to continue coverage," the rule states.
The agency also pitched changes that would clarify that exchanges would not need to re-determine an enrollee's eligibility for financial subsidies when processing a voluntary termination of exchange coverage for someone who is dually enrolled in other qualifying coverage, as would occur under current rules. Exchanges also would not re-determine eligibility for subsidies when an enrollee is identified through periodic data matching as deceased—a change that the agency said would reduce the risk of incorrect subsidy payments.
The changes are included in the proposed HHS Notice of Benefit and Payment Parameters for 2021. Comments are due on March 2.
Other changes proposed by the CMS include revising a regulation that it finalized for the 2020 plan year that allowed health insurers to implement copay accumulator programs to prevent drug manufacturer coupons from going toward a patient's annual limit on out-of-pocket costs when a generic drug is available.
For 2021, it proposed extending the policy and allowing insurers to exclude drug maker coupons from applying to the annual limit on cost-sharing even when there is no generic drug available.
In a statement, Carl Schmid, the former deputy executive director of the AIDS Institute who is now with the newly formed nonprofit organization HIV + Hepatitis Policy Institute, said the change would make it harder for patients to afford and stick to their medications.
"Not only will it increase patients' costs, but it will translate in insurance companies collecting even more money off prescription drugs," he said. "We urge HHS not to finalize such an anti-patient proposal."
The agency further proposed allowing exchange health insurers the option of implementing value-based insurance plan designs to encourage patients to seek high-value care at lower costs. The value-based plans would be voluntary and not preferentially displayed on HealthCare.gov.
The proposed rule lists a number of high-value services, such as blood pressure monitors and glucometers, that it said insurers may want to consider setting at lower or zero cost-sharing. Conversely, it lists low-value services, such as outpatient surgeries and high-cost imaging, that it said insurers should consider setting at higher cost-sharing.
The CMS also proposed maintaining the current user fee rate of 3% of premium charged to health insurers on the federal exchange and 2.5% for state-based exchanges but asked for comment on whether the rates should be reduced further. It further pitched technical updates to the risk adjustment program that it said would encourage insurer participation and strengthen the individual and small group insurance markets.
As it does every year, the CMS proposed updating the maximum annual limit on how much patients can pay out-of-pocket for their medical care. The agency would raise that limit to $8,550 for self-only coverage and $17,100 for family coverage, reflecting a 4.9% increase above 2020 limits.
It also wants to make some technical changes to the way an insurer's medical loss ratio is calculated. The ACA requires that insurers spend at least 80% of premium income on medical claims and quality improvement activities. The CMS proposed allowing insurers to include wellness incentives as quality improvement activities in the individual market for MLR reporting. At the same time, it said it wants insurers to deduct prescription drug rebates from MLR incurred claims.
A few other changes pertain to states. The CMS began posting quality ratings for plans on HealthCare.gov in 2020. It proposed allowing state-run exchanges to customize those quality ratings provided by the HHS.
Additionally, it wants to require states to annually report any state-required health benefits that are in addition to the 10 essential health benefits required by the ACA. The change will help ensure federal subsidies are protected and states are appropriately compensating individuals and insurers for those extra benefits, the CMS explained.
Finally, the CMS added a few new special enrollment periods, in which certain individuals are allowed to enroll in exchange coverage outside of open enrollment. The agency said it wants to shorten the time between enrollment during a special enrollment period and the start of coverage.
It also proposed allowing adding a new special enrollment period for exchange members enrolled in silver plans who become newly ineligible for a cost-sharing reduction subsidy so they can change plans.
"This proposal may help impacted enrollees' ability to maintain continuous coverage for themselves and for their dependents in spite of a potentially significant change to their out of pocket costs," the proposed rule states.