The Centers for Medicare &
Medicaid Services (CMS) issued the final Market Stabilization
rule to help lower premiums and stabilize individual and small
group markets, and to increase choices for Americans.
Individuals obtaining coverage in the Marketplace created by the
Affordable Care Act have faced double-digit premium increases,
fewer plans to choose from, and a market that continues to be
threatened by insurance issuer exits.* The CMS rule is designed
to provide some relief for patients and issuers now.
“CMS is committed to ensuring access to high quality affordable
healthcare for all Americans and these actions are necessary to
increase patient choices and to lower premiums,” said CMS
Administrator Seema Verma. “While these steps will help
stabilize the individual and small group markets, they are not a
long-term cure for the problems that the Affordable Care Act has
created in our healthcare system.”
The final rule makes several policy changes to improve the market
and promote stability, including:
- 2018 Annual Open
Enrollment Period: The final rule adjusts the annual Open
Enrollment period for 2018 to more closely align with
Medicare and the private market. The next Open
Enrollment period will start on November 1, 2017 and run
through December 15, 2017, encouraging individuals to enroll
in coverage prior to the beginning of the year.
- Reduce Fraud,
Waste, and Abuse: The
final rule promotes program integrity by requiring
individuals to submit supporting documentation for special
enrollment periods and ensures that only those who are
eligible are able to enroll. It will encourage individuals
to stay enrolled in coverage all year, reducing gaps in
coverage and resulting in fewer individual mandate penalties
and helping to lower premiums.
- Promote
Continuous Coverage: The final rule promotes personal
responsibility by allowing issuers to require individuals to
pay back past due premiums before enrolling into a plan with
the same issuer the following year. This is intended to
address gaming and encourage individuals to maintain
continuous coverage throughout the year, which will have a
positive impact on the risk pool.
- Ensure More
Choices for Consumers: For the 2018 plan
year and beyond, the final rule allows issuers
additional actuarial value flexibility to develop more
choices with lower premium options for consumers, and to
continue offering existing plans.
- Empower States
& Reduce Duplication: The final rule
reduces waste of taxpayer dollars by eliminating duplicative
review of network adequacy by the Federal Government. The
rule returns oversight of network adequacy to states, which
are best positioned to evaluate network adequacy.
CMS also made a number of other announcements regarding the
process that issuers must follow to meet the law’s requirements
for the 2018 plan year. The additional guidance released includes
updates to make the guidance consistent with the final rule and
provide information needed by issuers in order to have their
plans certified for 2018, including: Key Dates for 2017; Issuer Guidance on Uniform Rate Review Timeline; Good Faith Compliance Guidance; QHP Certification Guidance for States;
and Final Actuarial Value (AV) Calculator for
2018 and Methodology.
The final rule can be found, here: https://www.federalregister.gov/documents/2017/04/18/2017-07712/patient-protection-and-affordable-care-act-market-stabilization
*Recent statistics related to the Affordable Care Act:
- Approximately one-third of counties in
the U.S. have only one insurer participating in their
exchange for 2017.
- Five states have only one insurer
participating in their exchange for 2017.
- The premium for the benchmark
second-lowest cost “silver plan” on HealthCare.gov increased
by an average of 25 percent from 2016-2017.
- Approximately 500,000 fewer Americans
selected a plan in the exchange open enrollment in 2017 than
in 2016.
- Many states saw double digit increases in
their insurance premiums including:
- AZ: 116%
- OK: 69%
- TN: 63%
- AL: 58%
- PA: 53%
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