CMS Proposes Rules To Increase Oversight of Exchange Health Plans

On Friday, CMS released a set of proposed rules that would bolster standards for health insurers participating in the Affordable Care Act's federal health insurance exchange, following widespread complaints from consumers, Modern Healthcare reports (Modern Healthcare, 3/15).

Under the proposed rules, CMS would step up its oversight of health plan networks offered through plans sold on the federal exchanges rather than relying predominately on reviews from state insurance regulators and private groups that accredit health care policies (Pear, New York Times, 3/14). Specifically, the agency would evaluate plans to ensure that they provide adequate access to hospitals, primary care physicians, oncologists and mental health providers.

In addition, plans sold on the exchanges would be required to include at least 30% of an area's "essential community providers," up from 20% proposed in 2014 (Millman, "Wonkblog," Washington Post, 3/14). Those providers can include hospital, community health centers and HIV/AIDS clinics, among other provider centers.

The proposed rules also would:

• Require health plans sold through the exchanges to provide easily accessible online information about network providers and whether included physicians are accepting new patients;
• Require insurers to submit data supporting their quality ratings, including HHS-calculated quality ratings and beneficiary satisfaction survey results;
• Align the start of annual employer selection periods in the Small Business Health Options Program with the open enrollment period in the exchanges to minimize consumer confusion;
• Limit states' abilities to restrict the activities of exchange navigators and other exchange assisters, partly by specifying which types of state laws affecting such activities conflict with federal law (Modern Healthcare, 3/15); and
• Prohibit exchange plans from discriminating against consumers with significant health needs, such as by evaluating copayments for prescription drugs, hospital stays and visits to specialists and challenging any plan that requires prior authorization for an unusually large amount of drugs used to treat particular conditions (New York Times, 3/14).

The proposed rules also would change the medical-loss ratio -- which limits how much of premium profits insurers can spend on administrative costs -- to help insurers offset the cost of implementing the ACA amid the rocky rollout of the federal exchange website. The rules also would amend the law's risk corridors provision by increasing the floor on insurer profits by two percentage points in order to address insurers' additional transition and implementation costs.

According to Modern Healthcare, the proposed rules are designed to apply to insurers participating in the federal exchange. However, the rules also were written to help sway insurers into participating in the state-operated exchanges (Modern Healthcare, 3/15).  

Insurers Protest Changes

Insurers largely protested the proposed rules, the New York Times reports (New York Times, 3/14). According to Modern Healthcare, insurers have limited the provider networks in their plans as a way of keeping premium costs down (Modern Healthcare, 3/15).

For example, Katie Mahoney, executive director of health policy at the U.S. Chamber of Commerce, called the new proposed rules a "regulatory power grab," and she cautioned that they could increase health care costs for employers and employees.

Similarly, America's Health Insurance Plans Executive Vice President Daniel Durham said that many consumers would prefer plans with smaller networks and lower costs (New York Times, 3/14).

In response, a senior official in the Obama administration said the proposed rules will not change insurers' ability to make "decisions about which providers and doctors are in their networks," but instead "marks the first time that federal law requires insurance plans to offer adequate networks of doctors" ("Wonkblog," Washington Post, 3/14).

HHS Bolsters Coverage for Same-Sex Couples

In related news, HHS on Friday released guidance that would require insurers offering health coverage to spouses in heterosexual marriages to also do so for spouses in same-sex marriages, Kaiser Health News' "Capsules" reports.

Under the guidance, same-sex couples married in any of the 17 states that permit such marriages or Washington, D.C., are entitled to equal access to spousal coverage no matter where they reside. The guidance does not extend to couples who are in domestic partnerships or civil unions, "Capsules" reports.

According to "Capsules," the guidance specifically applies to health plans sold through the insurance exchanges that were not in operation prior to the ACA (Andrews, "Capsules," Kaiser Health News, 3/14). According to AP/ABC News, the guidance also applies to individual and employer plans offered outside the exchanges. States will have the final say on whether to extend such a policy to Medicaid beneficiaries. 

Insurers have until Jan. 1, 2015, to comply with the rules.

HHS Says Insurers Must Accept Ryan White Payments

In a separate announcement, HHS said that insurers are prohibited from rejecting consumers with HIV/AIDS whose premiums are being covered through the federal Ryan White program (Alonso-Zaldivar, AP/ABC News, 3/14). Several insurers had announced plans to reject such consumers, citing a 2013 CMS directive about third-party payments and its interpretation of the rules to eliminate fraud under the ACA (Carlson, Modern Healthcare, 3/12).