One week before President-elect Donald Trump’s inauguration, the Biden administration is finalizing a rule that sets new standards for the individual market under the Affordable Care Act (ACA).
First proposed in October, the rule protects consumers from having their coverage swapped unwittingly. Brokers and agents that violate this policy, and pose other “unacceptable” risks, can be suspended. The rule will go into effect Wednesday.
The rule also amends the risk adjustment program through user fee rates, new calculations to the Basic Health Program and reporting to the ACA Quality Improvement Strategy, designed to improve member outcomes.
Cost-sharing reduction loading, or the policy of increasing premiums to offset lower deductibles and copayments, will be allowed and codified into law if “actuarily justified” and if they do not already received enhanced premium tax credits, a fact sheet from the Centers for Medicare & Medicaid Services (CMS) says. The CMS was seeking comments from stakeholders following the proposed rule on the practice of silver-loading.
In an effort to “reduce plan choice overload” and create a healthier marketplace, the agency is choosing to change how health plans can offer non-standardized plans.
“This includes plans offered under the non-standardized plan option limit exceptions process that facilitate the treatment of chronic and high-cost conditions, which could play an important role in combatting health disparities and advancing health equity,” the agency said.
Monday’s final rule confirms health equity changes from the proposed rule in October. The agency is implementing a fixed-dollar premium payment threshold with two percentage-based thresholds options.
However, the CMS is finalizing a cap of $10 or less for the fixed dollar threshold, $5 higher than previously suggested. The gross premium threshold is also set at 98% instead of the proposed 99% mark.
These changes allow consumers a better opportunity to keep their insurance coverage even if they do not pay immediately pay their premium in full.
The rule modifies the risk adjustment model to use data from 2020, 2021 and 2022 for the 2026 benefit year. The risk adjustment model is changing how hepatitis C drugs and pre-exposure prophylaxis are factored as well as finalizing a change to medical loss ration reporting and calculations.
Fee rates for the federally facilitated marketplace will be set at 2.5% of monthly premiums, while a state-based marketplace on the federal platform will be set at 2%.