Proposed Regulations Released to Stabilize ACA Marketplaces

Yesterday, in response to concerns about insurers pulling out of the ACA marketplaces and raising premiums, the federal government published proposed rules to stabilize the individual and small group health insurance markets.

In a press release, Dr. Patrick Conway, Acting Administrator of the Centers for Medicare & Medicaid Services acknowledged the changes are short term relief “while future reforms are being debated.” 

The health insurance industry welcomed the proposals. AHIP CEO Marilyn Tavenner released a statement commending the rules. AHIP is a national association whose members are health insurance companies.

“Our commitment is to ensure short-term stability and long-term improvements.  While we are reviewing the details, we support solutions that address key challenges in the individual market, promote affordability for consumers, and give states and the private sector additional flexibility to meet the needs of consumers.”

Consumer advocacy groups have said that the new proposals will leave consumers with less choice and less affordable coverage.  

Below is a quick summary of the major changes proposed:

  • The draft rule proposes to allow insurers to sell marketplace plans with higher deductibles and cost-sharing at every metal level. The Center on Budget and Policy Priorities analysis of the proposed rule finds moderate income families will face increased premiums or higher out-of-pocket costs.  Families USA says that the new rules could decrease ACA financial assistance for 8 out of ten families now receiving subsidies to help pays premiums and out-of-pocket charges.  
  • Shorten the annual window for people to enroll in coverage from November 1 to December 15 rather than November 1 to January 31. A six week open enrollment period is more like what Medicare and large employers offer.
  • Tighten the rules to enroll throughout the year, during “special enrollment periods” as people experience certain life changes, such as losing health coverage or having a child. Some critics have said that the special enrollment periods allow individuals to sit out of insurance while they are healthy and enroll only when they get sick and need health care.
  • Tighten rules around non-payment grace periods. 
  • Eliminate standards for network adequacy. The Administration is proposing to eliminate federal protections to ensure that consumers have access to necessary doctors and hospitals once they enroll in coverage. The proposed rules also weaken requirements for insurers to include providers in their networks who serve predominantly low-income, medically underserved populations, such as federally qualified health centers (FQHCs).
  • The administration is seeking comments whether to change the rules for pre-existing conditions by allowing insurers to not cover pre-existing conditions if there has been a gap in insurance coverage.

The proposed rule, 71 pages long, can be found here.  Comments are due no later than 5 p.m. on March 7, 2017.