On February 29, the Department of Health and Human Services (HHS) issued final regulations that address a wide range of benefit and payment parameters under the Affordable Care Act (ACA), effective for plan years beginning on or after January 1, 2017. The final regulations include some changes from the proposed rules that were issued in November 2015, and delayed a few provisions contained in the proposed rules until 2018.
On the same date:
- The Centers for Medicare and Medicaid Services (CMS) issued an FAQ that clarified the suspension of the 2017 Health Insurance Industry Fee. The moratorium will apply to the Health Insurance Industry Fee that would have been due in the 2017 calendar year based on 2016 data.
- CMS also issued a bulletin announcing that non-grandfathered individual policies and small group plans may extend their exemption from certain ACA provisions under the previously announced transitional relief. If the applicable state permits, an extension may be granted through December 31, 2017. As of January 1, 2018, these policies and plans will need to comply with all ACA requirements. Earlier guidance had required these policies and plans to end by October 1, 2017.
Here is an overview of some key regulations in the final 2017 Benefit Payment and Parameters.
2017 Out-of-Pocket Maximums
The 2017 annual out-of-pocket maximums will be $7,150 for individual coverage and $14,300 for family coverage.
Marketplace Enrollment Period
The 2017 and 2018 open enrollment periods will follow the same timing as 2016 enrollment: November 1 through January 31 of the following year.
For 2019 and future years, the annual enrollment period will be November 1 through December 15.
Marketplace Automatic Reenrollment
If the plan in which an individual is currently enrolled is no longer available, Marketplaces may enroll consumers in a plan offered by another insurer if the current insurer does not have a plan available for reenrollment through the Marketplace.
2017 User Fee
The fee insurers pay to sell individual policies through the Federally Facilitated Marketplace (FFM) will remain at 3.5% of the monthly premium. Insurers transitioning to selling policies through State-Based Marketplaces on the Federal Platform (SBM-FPs) will pay a reduced user fee of 1.5% of premium for 2017 and 3% of premium in future years.
Network Adequacy Standards
The final rules have adopted several changes related to network adequacy requirements for plans sold on the Marketplace.
- Transparency of network size – Beginning in 2017, HealthCare.gov plans to include a rating of each plan’s relative network size compared to other plans available in the same geographic area.
- Coverage when a provider leaves the network – New continuity-of-care requirements will apply in the Federal Marketplace. Insurers must provide 30 days’ advance notice to patients receiving treatment from a provider who is leaving the network. Insurers will have to continue in-network coverage for individuals receiving active treatment, until the treatment is complete or for 90 days, whichever occurs first.
- Treating certain out-of-network expenses as in-network – Beginning in 2018, cost-sharing amounts for certain services performed by out-of-network ancillary providers (e.g. anesthesiologists) at in-network facilities must be counted toward the in-network, annual out-of-pocket maximum. Only when the insurer provides written notice to the patient – at least 48 hours prior to the time of service – may the out-of-network service be billed at an additional cost. This is intended to help limit “surprise bills” for consumers.
Standardized Plan Options in the Individual Marketplace
The standardized plan system will remain in place to make it easier for consumers to compare costs for similar plans offered by different insurers in the Federal Marketplace. The current proposal includes four silver, one bronze and one gold plan. The standardized plans have:
- Standard deductible amounts
- Four-tier drug formularies
- Only one in-network provider tier
- Some services, such as office visits, urgent care and generic drugs, not subject to the deductible
- A preference for copayments over coinsurance
Insurers can choose to offer standardized plans, non-standardized plans or both. Standardized plans will be displayed on HealthCare.gov in a manner intended to make them easy for consumers to find.
New Model for State/Federal Marketplace Partnerships
State Marketplaces that use HealthCare.gov’s technology for eligibility and enrollment will be known as State-Based Marketplaces on the Federal Platform (SBM-FPs). States will retain primary responsibility for plan management and consumer assistance, and for ensuring all Marketplace requirements are met. States will use the Federal platform for eligibility determinations and enrollment processing. This model is intended to make the transition easier should additional states decide to move to this arrangement in the future.
Navigator Responsibilities Beyond Enrollment
Beginning in 2018, Navigators will be required to provide post-enrollment assistance for functions such as Marketplace eligibility appeals, application for exemptions through the Marketplace, and helping consumers understand how to use their benefits. Navigators will also be required to assist vulnerable and underserved populations, as identified by the state-based exchange in their area.
Marketplace Enrollment Directly on Broker and Insurer Websites Delayed until 2018
Beginning in 2018, individuals may enroll in Marketplace coverage directly through an insurer or broker’s website. Further guidance and requirements will be issued. Until then, the current Marketplace enrollment process will continue.
Changes to Federally Facilitated SHOP Plans
As of January 1, 2017, a new employee choice option will be offered on the Federally facilitated Small Employer Health Options Program (SHOP). Currently, employers can offer employees a single plan or a choice of plans within a metal level. Under the new “vertical choice” model, employers will be able to offer employees a choice of all plans across all available levels of coverage from a single insurer. States can choose to opt out of offering vertical choice.
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