With Open Enrollment right around the corner, we wanted to take a moment and address some of the changes we will see taking place this year. Below is an outline of changes created by a CMS-issued Final Rule (CMS-9929-F) that will go into effect on June 19, 2017, 60 days after the initial publication in the Federal Register on April 18, 2017.
The rule addresses:
- Standards related to special enrollment periods (SEPs)
- Guaranteed availability
- Timing of AEP and OEP for 2018
- Standards related to network adequacy and essential community providers for qualified health plans
- Actuarial value requirements
Health insurers frequently raise the issue of the abuse and misuse of SEPs, which may enable sick enrollees not entitled to an SEP to join plans outside of open enrollment. To combat this perceived abuse, CMS is requiring pre-enrollment verification of all SEP enrollments for states served by HealthCare.gov.
The open enrollment period for 2018 has been shortened to run from November 1 through December 15, 2017. While CMS states that this change will reduce opportunities for adverse selection, it will likely create significant challenges for brokers who are attempting to help a large, diverse book of business in a shorter period of time.
CMS is changing its interpretation of the guaranteed availability requirement to allow insurers to apply a premium payment to an individual’s past debt owed for coverage from the prior 12 months before applying the payment toward a new enrollment. This change is intended to encourage individuals to maintain continuous coverage throughout the year. Previously, insurers have provided anecdotal examples of individuals who paid premiums for 2–3 months while obtaining services, and then subsequently stopped paying their premiums, allowing their coverage to lapse. These individuals later re-enrolled with no consequence during the following OEP.
CMS will defer to individual state review of network adequacy, which will eliminate a duplicative review by the federal government.
Actuarial Value Requirements
CMS issued changes to the de minimis allowable variation in the actuarial value of a health plan. This change is intended to give insurers greater flexibility in creating lower cost plans, in an effort to attract younger and healthier enrollees.
Cornerstone will continue to provide updates on the implementation of these rule changes. Brokers should be aware that, while these changes are intended to stabilize the individual market, a great deal of uncertainty still surrounds the administration’s intent to pay and preserve cost-sharing subsidies.