In December 2021, the Centers for Medicare & Medicaid Services (CMS) released the proposed Notice of Benefit and Payment Parameters for 2023. This proposal kicks off the annual rulemaking cycle for the Marketplaces and the individual and group health insurance markets for plan year 2023 and beyond.
This year's notice is the first to be entirely proposed under the Biden Administration's Department of Health and Human Services (HHS), and it reflects the priorities and views of the new leadership, including proposals to:
- Restore protections against discrimination on the basis of sexual orientation or gender identity. HHS is also proposing several changes and seeking comment on matters related to health equity and climate change;
- Restore standardized benefit plans, eliminated during the Trump Administration, and require standardized plans to be offered in federally facilitated Marketplaces. These plans are intended to reduce consumer confusion and allow apples-to-apples comparison of plan options;
- Implement stricter standards for the adequacy of health plan provider networks, relying on time-and-distance standards and an increased number of essential community providers, and resuming the federal government's role in reviewing adequacy in federally facilitated Marketplaces;
- Revise medical loss ratio regulations to somewhat restrict the costs that can be reported as incurred claims or quality improving activities;
- Require that issuers of individual market or small group health insurance be able to point to peer-reviewed clinical evidence to demonstrate that their benefit designs are not discriminatory; and
- Implement new standards for the conduct of brokers, prohibiting the use of scripting or automated interactions with CMS systems or direct enrollment (DE) Pathways unless approved by CMS.
Comments on the proposals are due January 27.
Select Proposals in the Proposed 2023 NBPP
Discriminatory Benefit Designs. HHS is proposing a more comprehensive standard for nondiscrimination in benefit designs for individual market and small group health insurance coverage, including qualified health plans (QHPs) sold on the Affordable Care Act (ACA) Marketplaces. Existing regulation prohibits these plans from using a benefit design that discriminates based on "an individual's age, expected length of life, present or predicted disability, degree of medical dependency, quality of life, or other health conditions." The proposed rule specifies that in order to meet this standard, a benefit design must be "clinically based" and incorporate "evidence-based guidelines into coverage and programmatic decisions," including "current and relevant peer-reviewed medical journal article(s), practice guidelines, recommendations from reputable governing bodies, or similar sources."
In addition to the proposed regulation, HHS provides illustrations of presumptively discriminatory benefit designs.
Medical Loss Ratio. HHS is proposing amendments to the medical loss ratio (MLR) regulations to clarify reporting of incurred claims and expenditures for quality improving activities (QIA). The MLR rules require issuers of group or individual health insurance coverage to spend a minimum percentage of premium revenue on incurred claims or QIA, or rebate the difference to policyholders. HHS is first proposing to amend the regulatory definition of incurred claims to clarify that incentive or bonus payments to health care providers count as incurred claims only if they are "tied to clearly defined, objectively measurable, and well-documented clinical or quality improvement standards that apply to providers." Second, HHS is proposing to exclude from QIA "indirect" costs of QIA, including plan overhead that might have been attributed to QIA.
Standardized Plans & Choice Architecture. HHS is proposing to reintroduce standardized plan designs in federally facilitated Marketplaces. Standardized plans are uniform plan designs offered with the same cost-sharing parameters from issuer to issuer, making plan choice and comparison simpler for enrollees. In the 2017 and 2018 payment notices, HHS defined standardized plan parameters and gave them certain display and filtering advantages in online searches, but issuers were not required to offer them. The Trump Administration discontinued this approach in the 2019 payment notice, yet that decision was subsequently struck down in a federal lawsuit. In 2021, HHS indicated that it did not have sufficient time to restore standardized plans for 2022, leaving the issue for this year's payment notice. In its new proposal, HHS is reinstating standardized plans on a mandatory basis. The rule requires issuers to offer standardized plans for every product type (e.g., PPO, HMO), metal level (including expanded bronze and three cost-sharing reduction (CSR) variations for silver), and service area where the insurer offers non-standardized products.
Network Adequacy. HHS is proposing new and more stringent requirements for the review of QHP networks, reversing a policy of more deference to state regulators during the Trump Administration.
Under the proposal, the federal government would resume a more active role in the review of networks for federally facilitated Marketplaces, and in determining the standard under which plans are reviewed. The 2019 payment notice deferred to states, "provided the State has a sufficient network adequacy review process." As now proposed, HHS will resume review of QHP networks in all federally facilitated Marketplace states, except where the state performs plan management functions and the state applies and enforces quantitative network adequacy standards that are at least as stringent as the federal network adequacy standard, and performs its review before plan certification.
As to the standards themselves, HHS will measure networks using quantitative standards that measure time and distance to providers in the network's most preferred tier on a county-by-county basis, in alignment with the metrics used in Medicare Advantage. The plan would also measure appointment wait times and require submission of information on telehealth availability. The required essential community provider participation standard would be raised from 20% to 35% of available providers.
Agents and Brokers. HHS is proposing to tighten its regulations governing insurance agents, brokers, and web-brokers assisting consumers in enrolling in QHPs.
- Prohibited Business Practices. HHS proposes to add new standards of conduct for agents, brokers, and web-brokers who assist consumers enrolling in QHPs. Specifically, HHS is proposing to prohibit the use of scripting and other automated interactions with CMS systems or the direct enrollment pathways that issuers and brokers can use to enroll individuals unless approved in advance by CMS and to require that agents, brokers, or web-brokers only use an identity that belongs to the consumer when identity-proofing consumer accounts on HealthCare.gov.
- Web-Broker websites. HHS proposes to amend its regulations to include a list of the QHP comparative information that web-broker private websites are required to display, bringing these websites into alignment with information about plans that is displayed on the Marketplace website itself.
- Broker Submission of Information. Agents, brokers, and web-brokers that assist with or facilitate enrollment of consumers in QHPs are required to submit correct information about the people they enroll to the Marketplace. Observing that incorrect information is frequently provided, HHS is proposing specific examples of what it means to provide "correct information" with regard to the enrollee's email address, mailing address, telephone number, and household income projection. For example, HHS is requiring that the email address provided for an enrollee be secure (e.g., password protected), not be disposable/temporary, and belong to the consumer. Likewise, the telephone number provided must belong to the consumer, not the producer arranging the enrollment. Also, only income estimates confirmed by the consumer to be accurate may be provided. This latter rule is proposed to avoid situations where producers provide incorrectly low income so as to generate more heavily subsidized premium projections.
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