June 12 Update: CMS Chooses To Continue Two Pilots Providing Consumer Information Rather Than Moving To Full Implementation
On June 9, 2017, the Centers for Medicare and Medicaid Services released two guidances announcing that pilot programs begun for the 2017 open enrollment period will be continued for the 2018 OEP. The first of these is a pilot program testing a system to disclose on HealthCare.gov ratings on relative breadth of network for pediatricians, adult primary care practitioners, and hospitals. Health plans are rated based on network information they submit for their qualified health plans and their networks are ranked relative to other plans. This rating program was piloted in 2017 in Maine, Ohio, Tennessee, and Texas. Information will be available only in these states again for 2018.
The second guidance concerns the pilot testing of quality and satisfaction star ratings for qualified health plans. The ACA requires health plans to collect quality and consumer satisfaction data and to report it to HHS. For 2017, CMS developed and pilot tested a star rating system based on the quality and satisfaction reports; the rating system was pilot tested in Virginia and Wisconsin for the 2017 open enrollment period and was supposed to be expanded to all states for 2018. Instead it will remain limited to the two states.
The Trump administration has emphasized its commitment to “empowering consumers and promoting consumer choice.” By delaying full implementation of these programs for another year it has missed an opportunity to promote this goal.
On June 8, 2017, the Centers for Medicare and Medicaid Services posted a request for information at the Federal Register entitled “Reducing Regulatory Burdens Imposed by the Patient Protection and Affordable Care Act & Improving Healthcare Choices to Empower Patients.” (press release )
The request is made pursuant to President Trump’s Executive Order of January 20, 2017, which ordered the departments in charge of implementing the Affordable Care Act to take steps to afford the states more flexibility and control, reduce regulatory and fiscal burdens, and increase the openness of interstate markets for health care services and insurance and options for consumers.
What The Request For Information Says
The request states that it is the goal of the Department of Health and Human Services to:
determine whether each rule [promulgated under Title I of the ACA] advances or impedes HHS priorities of stabilizing the individual and small group health insurance markets; empowering patients and promoting consumer choice; enhancing affordability; and returning regulatory authority to the States. We seek public input on changes that could be made, consistent with current law, to existing regulations under HHS’s jurisdiction that would result in a more streamlined, flexible, and less burdensome regulatory structure, including identifying regulations that eliminate jobs or inhibit job creation; are outdated, unnecessary, or ineffective; impose costs that exceed benefits; or create a serious inconsistency or otherwise interfere with regulatory reform initiatives and policies.
The request recites as steps that HHS has already taken that it believes advance these goals:
- its market stabilization rule released in mid-April;
- the guidance it has released announcing its intention to end SHOP enrollment through the HealthCare.gov website;
- its announced intention to implement a new direct enrollment pathway for web brokers and insurers;
- the 1332 state innovation waiver checklist it has released;
- its extension of the risk adjustment data validation pilot for a second year;
- its extension of the time that insurers have to submit 2018 qualified health plan certification applications; and
- its extension of the transitional plan exception allowing states to permit insurers to offer ACA-non-compliant plans for another year.
It should be noted that many of these initiatives either extended Obama era policies (such as the transitional plans or the risk adjustment validation pilot) or were under consideration by the Obama administration before the election (such as extended direct enrollment, special enrollment period verification under the market stabilization rule, or ending HealthCare.gov enrollment for the SHOP exchange). Some of these Obama-era initiatives—in particular, the transitional plans—were of questionable legality under the ACA, but some of the Trump initiatives—such as stretching the “de minimis variation” permitted for health plan variation, push the boundaries in other directions. The request for information seems to contemplate steps that would depart even further from the legal moorings of the ACA.
HHS specifically asks for comments on changes it could make to its regulations or guidance or other steps it could take to further four goals in the individual and small group insurance markets:
- Empowering patients and promoting consumer choice. What activities would best inform consumers and help them choose a plan that best meets their needs? Which regulations currently reduce consumer choices of how to finance their health care and health insurance needs? Choice includes the freedom to choose how to finance one’s healthcare, which insurer to use, and which provider to use.
- Stabilizing the individual, small group, and non-traditional health insurance markets. What changes would bring stability to the risk pool, promote continuous coverage increase the number of younger and healthier consumers purchasing plans, reduce uncertainty and volatility, and encourage uninsured individuals to buy coverage?
- Enhancing affordability. What steps can HHS take to enhance the affordability of coverage for individual consumers and small businesses?
- Affirming the traditional regulatory authority of the States in regulating the business of health insurance. Which HHS regulations or policies have impeded or unnecessarily interfered with States’ primary role in regulating the health insurance markets they know best?
The request asks that comments be submitted within 30 days.
The RFI And The ACA
While the language of the request is clearly in line with the policy goals of the Trump administration, it seems to fit uncomfortably with the ACA itself, which remains the law of the land until it is repealed. In adopting the ACA, Congress made a clear choice as to how, for example, to “encourage uninsured individuals to buy coverage”—the individual mandate. But there remains continued uncertainty as to whether the Trump administration intends to enforce it.
The request refers to stabilizing the “individual, small group, and non-traditional health insurance markets,” yet Congress chose in enacting the ACA to eliminate markets for non-ACA compliant products so as to protect the individual and small group markets from adverse selection and thus stabilize them. What is the “non-traditional” market, and might recognition of such a market not further threaten the stability of the “traditional” markets? The term may refer to short-term insurance policies, which HHS limited in 2016 to three months and which could certainly attract healthy people away from the general individual market risk pool, further destabilizing it, if they were once again allowed to be sold for 364 days, as they were earlier. On June 8, a group of Republican Senators wrote to HHS asking that the Obama-era rule be reversed.
What Stakeholders Are Saying Now
Moreover, the Trump administration has in fact been receiving a great deal of advice recently from state regulators, insurers, consumers, and other interested parties as to what it needs to do to stabilize insurance markets and enhance affordability. The National Association of Insurance Commissioners, which speaks for the state regulators responsible for insurance markets, has said repeatedly that the Trump administration must provide assurances that reimbursement to insurers for the ACA’s cost-sharing reduction (CSR) payments will be guaranteed for 2017 and 2018 if markets are to be stabilized. This advice has been repeated by America’s Health Insurance Plans, the Blue Cross Blue Shield Association, the American Hospital Association, the American Medical Association, and the United States Chamber of Commerce. The nation’s governors have also sent this message.
Insurers in a number of states have made clear that the failure of the administration to clarify its intentions with respect the payment of the CSR payments and the enforcement of the individual mandate are the biggest factors driving significant premium increase requests for 2018. Anthem recently announced that it is withdrawing from the ACA marketplace in Ohio because of continued regulatory uncertainty, including uncertainty surrounding the reimbursement of cost sharing reductions. Covered California, the California marketplace, is likely to recommend that insurers assume that the cost-sharing reductions will not be paid and to set their rates accordingly if there is not commitment to funding the CSRs by late summer.
At this point the biggest thing needed to stabilize the individual insurance market is for the administration to act on the advice it has already been given.