Insurers that have prospered—and those that have struggled in ACA marketplaces—urged changes to their rules.

Oct. 24—Federal officials recently sought comments on the 2018 rules for the government-run insurance marketplaces, and insurers responded that immediate changes are needed.

Among the urgent changes requested for the 2017 plan year was restricting the use of special enrollment periods (SEPs), requiring payment of outstanding premiums before re-enrollment, barring premium assistance by providers, and limiting use of 90-day grace periods during which enrollees can use coverage for which they have not yet paid.

America’s Health Insurance Plans (AHIP) was among the insurers and advocates calling for “immediate steps” by the Centers for Medicare & Medicaid Services (CMS) to bolster the marketplaces that the Affordable Care Act created. These marketplaces have seen a growing number of insurers depart amid large and growing losses, as well as premiums that will increase by an average of 25 percent in 41 states, according to tracking site

In its comments, AHIP noted that the ACA marketplaces have helped push uninsured rates from state to state to their lowest levels on record.

Meanwhile, Matthew Eyles and Gregory Gierer, both officials at AHIP, wrote in comments on draft rules for 2018 that, “However, while coverage gains represent important gains, the exchange marketplace is a work in progress, and immediate steps are necessary to help stabilize the market and assure access to affordable choices for consumers.”

SEP Issues

Up-front eligibility verification is needed for SEP enrollees to prevent abuse of the insurance sign-ups allowed for special situations, such as job loss, the Blue Cross and Blue Shield Association (BCBSA) agreed. About a quarter of total ACA enrollment came in through SEPs in 2015, and insurers were required to enroll up to 40,000 individuals through SEPs each week in 2016, according to CMS.

Actuaries estimate that better verification of those SEP enrollees could help lower premiums by up to 5 percent, BCBSA noted.

To underscore the need for SEP enrollees to pay their outstanding premium balances before re-enrolling, BCBSA cited a national consumer survey by McKinsey and Co. that found 18 percent of consumers stopped paying their premiums in 2015 and then reenrolled in 2016. Half of these consumers returned to the same qualified health plan in 2016 for which they stopped payment in 2015.

“CMS should immediately issue guidance to require people who fall into a grace period to pay all outstanding premiums and become whole with an issuer before reenrolling with that same issuer,” wrote Alissa Fox, senior vice president for BCBSA.

Insurers also raised the alarm about the non-prohibited effort by providers and organizations “primarily funded by providers” to pay patients’ premiums for ACA plans.

Insurers Suffer Losses

Aetna, which sharply reduced ACA marketplace participation after steep losses, noted that the changes CMS proposed for 2018 do not “fundamentally fix the problems with today’s marketplace.” Specifically, the insurer cited an enrollee population that is half of what was originally projected, sicker-than-expected enrollees, and enrollees signing up only when they need services and then dropping coverage.

 Among needed changes are rules that allow “affordable benefit designs” capable of attracting young enrollees and improving the overall marketplace risk pool.

“HHS has failed to make changes that are critical to supporting more affordable benefit options,” wrote Steven Kelmar, executive vice president for Aetna.

Kelmar also blasted coming standardized plans as likely discouraging “innovations necessary in benefit design that could further improve affordability.”

UnitedHealthcare, which also suffered steep losses and exited most ACA marketplaces, urged a range of changes to the marketplaces’ rules. For instance, the insurer opposed a proposed high-risk enrollee pooling mechanism, which would create two new high-risk enrollee pools across all states.

“This approach goes beyond the goal of the risk-adjustment program to insulate issuers from enrollee health risks that can reasonably be foreseen at enrollment and instead extends protection for an insurance risk (e.g., random events) that might more appropriately be provided for through private reinsurance programs,” the insurer wrote.

High-Performing Plans

Changes also were sought by insurers offering ACA marketplace plans that succeeded financially.

Florida Blue, which is cited as an ACA success story, raised flags about proposals for the marketplaces to prohibit renewal of coverage for someone who has recently qualified for Medicare coverage.

“Our sales channels are careful to check with applicants to ensure we do not sell off-marketplace plans to Medicare-entitled or -enrolled individuals, but the marketplace does not seem to check Medicare status before allowing an applicant to enroll,” Florida Blue wrote in its comments. “As a result, we have a growing number of enrollees over age 65.”

Another financially successful ACA insurer, Kaiser Permanente, urged rule changes to provide consumers with information that enables them to choose health plans based on the quality and cost-effectiveness of the care they will receive.

“Existing quality measures are primarily designed to measure discrete care processes rather than overall clinical outcomes,” wrote Anthony Barrueta, senior vice president at Kaiser Permanente. “Adopting measures which focus on clinical improvement will allow consumers to select health plans based on meaningful outcomes.”

Centene, which obtained some of the best financial results among ACA marketplace insurers, also raised concerns about some of CMS’s planned changes.

Specifically, Centene was concerned about plans to increase flexibility for bronze-level plans, which must cover about 60 percent of enrollees’ healthcare costs. The proposed plan would allow the actuarial value of bronze plans to vary from 2 percentage points below to 5 percentage points above the 60 percent actuarial value requirement, so the plans could cover some additional services.

Jonathan Dinesman, senior vice president at Centene, wrote that the changes unintentionally may make the plans more attractive to enrollees who otherwise need the more generous coverage of silver-level plans, which are most popular on the exchanges but carry higher premiums. Enrollees enticed to bronze plans by seemingly equivalent coverage to a silver plans may not realize they can face higher out-of-pocket costs and will lose out on cost-sharing subsidies not available to bronze plan enrollees.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Monday, October 24, 2016