Editor’s note: This post was updated on February 6, 2014, to include information regarding coverage options for under-65 Medicare beneficiaries losing existing state high-risk pool coverage. (See the last section of the post.)
On February 4, 2014, the Center for Medicare and Medicaid Services released its Draft 2015 Letter to Issuers in the Federally Facilitated Marketplace. The Office of Personnel Management also released its 2015 Multi-State Plan Program Call Letter. This post will discuss both documents.
The CMS 2015 Draft Letter To Issuers
CMS publishes a Letter to Issuers each year to set out the guidelines for qualified health plans participating in the exchange for the following year. It first releases a draft and then a final letter. CMS requests comments on this draft Letter, but notes that many of the policies proposed in the Letter either are or will be going through rulemaking, and that the appropriate place to comment on these is in the rulemaking procedure. The 2015 Letter largely tracks the 2014 Letter, and this post will focus on new elements of the proposal, notably provisions addressing network adequacy and access to essential community providers.
The Letter sets out the requirements that insurers must meet to offer qualified health plans through the federal exchange. In partnership states where the state is performing plan management functions, compliance is reviewed by the state, which has some flexibility in applying certification standards. Partnership states make recommendations to CMS regarding plan certification, but CMS ultimately determines compliance. In non-partnership states, CMS reviews and determines compliance but will integrate state regulatory decisions into the certification process to the extent that state decisions are consistent with federal standards and timelines. States are primarily responsible for reviewing state law requirements, as well as compliance with market-wide requirements like essential health benefit and actuarial value standards.
Insurers in non-partnership federal exchange states will make their initial plan submissions between May 26 and June 27 of 2014. This begins an iterative review process, with the final submission of application data due September 4. CMS will send out final QHP certification notices on October 14, and open enrollment begins November 15. Partnership states will set their own deadlines for plan submission, but data must be transmitted to CMS, usually through the System for Electronic Rate and Form Filing (SERFF), by August 10. CMS will again complete certification by October 14 for a November 15 open enrollment period launch.
The federal exchange is responsible for considering rate increases when certifying plans. CMS intends to conduct an outlier analysis of QHP rates to identify rates that are relatively high or low compared to other QHP insurers, but intends again to rely largely on state rate review in states determined to have effective rate review programs.
Qualified health plan insurers must be licensed and in good standing with the state. CMS must independently determine that it is in the best interests of consumers to certify a plan and will review complaints and oversight findings in making this determination. CMS or the state will review plan service areas, which must be non-discriminatory and normally cover an entire county or group of counties
Network adequacy. The biggest changes in the Letter from 2014 concern network adequacy and access to essential community providers. In 2014, CMS largely relied on plan accreditation and state review to ensure adequate provider networks. One of the biggest complaints so far about QHP plans, however, has been that provider networks have been too narrow. CMS intends for 2015 to collect plan provider lists and review them to determine whether providers are available without unreasonable delay. It will focus on access to hospital systems, mental health providers, oncology providers, and primary care providers. CMS intends to use its review to develop time and distance or other standards for future network review.
Essential community providers. Another major complaint about QHPs has been lack of access to essential community providers such as federally qualified health centers, Ryan White HIV/AIDS providers, family planning providers, Indian health providers, and safety net hospitals. Under the 2014 Letter, QHPs had to cover 20 percent of the ECPs in their service area and could cover fewer if they provided a narrative explanation. Under the 2015 Letter, QHPs must include 30 percent of ECPs in their provider network and offer contracts in good faith to all available Indian health providers in their service area and at least one ECP in each ECP category (the categories listed above plus “other”).
CMS will provide a list of ECPs for QHPs to choose from, but QHPs may also identify additional ECPs not on the CMS list. QHPs that fail to meet the 30 percent standard may offer a narrative description of their efforts, including the names of ECP hospitals and FQHCs to which they offered contracts and their contingency plans for serving enrollees who would otherwise have been served by an ECP. QHPs that provide services through their own employed professionals or contracted medical groups must ensure reasonable and timely access for lower-income medically underserved enrollees in its service area. The Letter strongly suggests that CMS is expecting QHPs to improve access to ECPs.
For 2015, QHPs in their second year of certification must have commercial, Medicaid, or marketplace plan accreditation from the NCQA, URAC, or the Accreditation Association for Ambulatory Health Care. New plans in their initial year of certification must schedule or plan to schedule accreditation review.
As of January 1, 2015, QHP insurers must comply with patient safety standards and may only contract with hospitals or health care providers that meet quality improvement standards. Under proposed regulations implementing these standards, QHPs may only contract with hospitals with more than 50 beds that are Medicare or Medicaid certified and meet Medicare quality assessment and performance improvement and discharge planning standards. QHPs must also demonstrate compliance with patient safety standards.
Discriminatory benefit design. CMS is also tightening its standards for reviewing QHPs for discriminatory benefit design. It will perform outlier analysis with respect to cost-sharing, focusing on inpatient hospital stays, inpatient mental/behavioral health stays, specialist visits, emergency room visits, and prescription drugs. CMS also intends to review plans with an unusually large number of drugs subject to step therapy or prior authorization. It will also focus on “explanations” and “exclusions” that seem to involve reductions in benefits for certain subsets of individuals other than based on clinical indications.
The Letter requires greater transparency in drug formularies, including direct access to plan-specific formularies without enrollees having to log on or enter a policy number. CMS intends to issue rules that will allow new enrollees to access non-formulary drugs and avoid prior approval or step therapy for their first 30 days of coverage beginning on January 1 of each year, as they transition into a plan. CMS is also considering transitional providers for other types of care.
CMS intends to apply the “meaningfully different” standard it identified in the 2015 Payment Notice. This standard is based on the ability of a reasonable consumer to differentiate among plans based on difference in two or more features on a list of plan characteristics, including networks, formularies, deductibles, out-of-pocket maximums, covered benefits, premiums, and HSA eligibility.
The Letter announces that CMS is considering requiring all plans, or at least one plan at each metal level per issuer, to allow three primary care office visits prior to meeting any deductible. This is a statutory requirement for catastrophic plans and would ensure that enrollees in all plans could get some value from their plan without having to incur major expenses.
CMS announced for 2014 that it would not impose civil penalties or decertification on plans that made a good faith effort to comply with exchange requirements. CMS intends to continue to work collaboratively with plans, but may conduct targeted compliance reviews and will require compliance plans.
Agents and brokers are discouraged from using “marketplace” or “exchange” in the name of their businesses or websites, and must prominently display a standardized disclaimer on their websites that they are not the Health Insurance Marketplace. CMS intends to continue to leave review of marketing materials mainly to the state.
CMS intends to begin allowing employers to offer employee choice in the SHOP exchange in 2015, facilitated by premium aggregation so that employers will only need to pay a single premium. The Letter includes procedures and requirements for employer premium payment. The federal SHOP exchange will have minimum participation requirements, but they will not apply for renewals between November 15 and December 15.
QHPs must make their provider directories directly available through a URL on the exchange website without requiring consumers to log on or enter a policy number. The directory must include location, contact information, specialty, medical group, and institutional affiliation of providers, and whether the provider is accepting new patients. Insurers are encouraged to also list languages spoken, provider credentials, and whether the provider is an Indian health provider. QHPs are required to provide individuals with limited English proficiency or disabilities meaningful access to essential documents.
The OPM Multi-State Program Call Letter
The Office of Personnel Management Call Letter states that OPM intends to offer multistate plan coverage in at least five more states and to add one or more insurers or groups of insurers to the program. MSP insurers are expected to offer both self- and family-coverage at the gold and silver level. The MSP is not offering standalone dental plans.
OPM review of MSP plans is similar to CMS review of federal exchange plans, including review for meaningful difference and for non-discriminatory benefit design. MSP insurers (that is, for now, Blue Cross/Blue Shield) must ensure a meaningful difference between their MSP plan and the non-MSP plans that they offer in a state. Plans must offer habilitation services as an essential health benefit. The Call Letter notes that for many plans, habilitation services are aligned with rehabilitation services, but the Letter notes that habilitative services may need to be more extensive, and that there should be, therefore, an exceptions process.
OPM encourages four-tier drug plans, with generic, preferred brand, non-preferred brand, and specialty drug tiers. Like CMS, OPM will require plans to allow new enrollees 30 days of non-formulary drugs. OPM may also, like CMS, require plans to offer three primary care visits before the deductible attaches in at least one plan per metal level. OPM encourages patient education programs and access to the full range of weight reduction treatment options.
Like CMS, OPM intends to enforce network adequacy standards. In addition, however, MSP issuers must have in place a process to provide timely exceptions to ensure that consumers who need care from out-of-network providers (because of rare or complex medical conditions or lack of in-network providers in a geographic area) can receive it with reasonable cost-sharing, applying enrollee costs to the in-network out-of-pocket maximum, and protection from balance billing. This would seem to be a salutary requirement for all QHPs.
MSP plans are also encouraged to ensure that preferred provider organizations offer out-of-service-area coverage that is not limited to emergent and urgent care, provide coverage throughout metropolitan areas that cross state boundaries, and facilitate the administrative transfer of coverage for consumers who move among states. OPM seems intent on making the program not only multistate, but also more interstate.
Finally, OPM intends to collect and make available Consumer Assessment of Healthcare Providers and Systems (CAHPS) data on plans and to recognize plans that achieve exceptionally high levels of enrollee satisfaction.
Medicare And The Affordable Care Act
On February 4, 2014, CMS released a set of “Frequently Asked Questions” on the Bulletin Entitled the Sale of Individual Market Policies to Medicare Beneficiaries under 65 Losing Coverage Due to High Risk Pool Closures.” These FAQs concern the quandary of Medicare beneficiaries under age 65 who have been receiving coverage through state high risk pools but are about to lose this coverage as the state high risk pools close. In a number of states, these individuals are ineligible for Medicare supplement coverage, but are also barred from coverage through individual policies because individual coverage cannot generally be sold to individuals who are eligible for Medicare.
CMS announced on January 10, 2014, that it would not enforce the individual insurance purchase prohibition for these beneficiaries during 2014, giving states time to enact laws requiring Medicare supplement insurers to cover these people. I blogged about this guidance earlier.
The FAQ acknowledges again that HHS does not have authority to require either QHP insurers or Medicare supplement insurers to sell coverage to under-65 Medicare beneficiaries. Rather CMS encourages individual market insurers to make coverage available to these individuals and is creating a special enrollment period to allow Medicare beneficiaries losing state high-risk pool (other than End-stage Renal Disease, ESRD) coverage to enroll in Medicare Advantage plans, if they are otherwise eligible.
The FAQ clarifies that insurers may require documentation from applicants establishing enrollment in a high-risk pool as of the last day that they were able to be enrolled in the pool. Medicare beneficiaries have a 60-day special eligibility period to enroll in individual market coverage after losing high-risk pool coverage. Insurers must allow individuals to enroll in coverage enough ahead of time so as not to cause a gap in coverage as the individuals lose high-risk pool coverage. Beneficiaries other than ESRD recipients also have a special enrollment period for Medicare Advantage plans which begins 60 days before they lose high-risk pool coverage and ends 60 days after.
State high-risk pools will remain minimum essential coverage (for purposes of fulfilling the individual mandate and disqualification from receiving premium tax credits for high-risk plan enrollees) through the end of 2014, but a state will have to apply to CMS to have state high-risk pool coverage recognized as minimum essential coverage beyond that date.
Medicare beneficiaries enrolling in individual plans do not qualify for premium tax credits because they have Medicare Part A coverage. Under coordination of benefits rules, Medicare will be the primary payer for beneficiaries who enroll in individual coverage, while the individual coverage will be secondary. Individual market insurers can accept claims billed using the Medicare crossover process to cover co-insurance obligations.