In comments responding to CMS’s Feb. 17 market stabilization proposed rule (HPW 2/20/17, p. 3), several insurance carriers expressed support for the agency’s suggested improvements, but urged it to make bolder moves to calm the turbulent individual and small-group markets.
CMS’s proposed regulatory tweaks would, for example, make it more difficult to game special enrollment periods. The agency also would allow carriers to end coverage if premiums aren’t paid after 30 days, rather than requiring them to wait three months, and would extend the 2018 rate-filing deadline from May 3 to June 21. That would give carriers much-needed breathing room to decide whether to participate in the public exchanges this fall. More than 4,000 comments had been submitted as of March 10.
In comments submitted March 6, Aetna Inc. called the proposal “a good first step.” The company noted that 1% of its enrollees make up 44% of its claims costs, and urged the agency to create a permanent reinsurance provision — like the mechanism used for Medicare Part D. About $8 billion will be needed to fund the program for the 2018 plan year, the company estimated. “Without injecting this additional funding into the market to address high-cost individuals, we will continue to see 20%+ premium increases and fewer choices for consumers,” the company warned.
In its March 7 comments, Cigna Corp. also suggested the creation of a new reinsurance program, which could be put in place until state-designed high-risk pools can be established.
Aetna also urged CMS to work with Congress to find additional funding for the risk-adjustment program. It suggested the agency could strengthen that Affordable Care Act (ACA) provision by allowing pharmacy claims to count in 2017 risk adjustment submissions and excluding administrative costs from the risk-transfer formula.
The insurer did offer support for several proposed changes, however, such as deferring to state provider-network adequacy rules, moving to a 5:1 age-rating band, shortening the open-enrollment period (OEP), and allowing insurers to collect past-due premiums before re-enrolling someone in a new policy.
Carriers Want More AV Flexibility
Here’s a look at three more common themes from comments on CMS’s proposed rule:
Actuarial values: The proposal would expand the actuarial value (AV) range that defines metal tiers (HPW 2/20/17, p. 3). Silver-tier plans now must have a 70% AV, but that level can vary from 68% to 72% (i.e. +2%/-2%). Under the proposed rule, a silver-tier plan could have an AV as low as 66%. Alabama-based VIVA Health, Inc. doesn’t sell coverage through the exchanges but does offer non-grandfathered small-group products subject to AV requirements. The company says it supports CMS’s proposal to expand flexibility for AV requirements to +2%/-4%, but would like the agency to consider going further to +4%/-4%. Blue Cross Blue Shield of North Carolina suggested the same change, which it said would help consumers to “maximize subsidy dollars and to make buying richer benefits less cost prohibitive.”
Shorter enrollment period: Carriers were supportive of CMS’s proposal to cut the annual OEP in half — from Nov. 1 until Dec. 15, 2017. Ending the OEP in December, according to several commenters, would help stabilize the risk pool by allowing all coverage to begin on Jan. 1. Cigna supported the change, but urged the agency to communicate it “broadly to consumers.” Other stakeholders opposed it. Existing rules call for the next enrollment period to extend from Nov. 1 until Jan. 31, 2018. The National Partnership for Women & Families warned that consumers would have less time to shop for an appropriate health plans. A Colorado insurance broker said cutting the enrollment period from 92 calendar days to 45 days actually limits the OEP to 32 business days due to weekends and the Thanksgiving holiday. “The burden of this single proposed change will have such a negative impact to members, agents/broker, insurance carriers, government and state exchanges that I fear for the repercussion of this decision,” he wrote.
Machine-readable provider directories: The North Carolina Blues plan wants CMS to delete the requirements that issuers make machine-readable provider directory and formulary information available on their websites in a format and timing specified by CMS. “Issuers already make this information available to consumers on their websites and these machine-readable requirements create significant IT costs.” The Blues plan added that CMS’s search tools have led to consumer confusion in cases where providers or drugs show up incorrectly for certain plans.
To view all comments, visit www.regulations.gov/document?D=CMS-2017-0021-3237.