Insurers and hospitals have come together to rebuke a Trump administration proposal to roll back limits of plan designs that may be listed on the Affordable Care Act’s (ACA’s) exchanges.
In February, the Centers for Medicare & Medicaid Services (CMS) included in its Notice of Benefit and Payment Parameters for 2027 Proposed Rule a plan to allow some non-network plans to obtain qualified health plan (QHP) status, which is necessary to be listed.
Non-network plans refer to offerings that do not have contracts in place with providers outlining specific services and rates, or conditions outlining different benefits for enrollees based on whether a provider is in network. CMS proposed that such plans could still obtain QHP status for plan year 2027 if they can ensure access to multiple providers who accept the non-network plan’s benefit amount as full payment.
“This proposed policy aims to reduce overall health care costs by (1) empowering enrollees to utilize price transparency information to shop for lower prices and negotiate directly with providers, thus fostering increased competition, and (2) eliminating substantial administrative overhead associated with traditional network management, potentially resulting in lower premiums,” CMS said in a February fact sheet outlining the proposed rule.
The plan does not appear to have landed with industry groups. In a rare move, groups representing health plans (AHIP, Association for Community Affiliated Plans and Alliance of Community Health Plans) as well as hospitals (Federation of American Hospitals and America’s Essential Hospitals) crossed the aisle to submit a joint comment letter to CMS calling on the administration to rethink its approach.
“While our respective organizations represent opposite sides of the payor-provider continuum, we agree that, by definition, non-network plans cannot offer the comprehensive coverage that would be required for certification as a QHP,” the groups wrote in their March 13 letter. “We urge CMS not to finalize this provision.”
The groups’ top concern, they wrote, is that individuals shopping for coverage on the exchanges won’t be able to grasp the differences between network and non-network plans, potentially exposing them to higher-than-expected out-of-pocket costs.
Further, the groups questioned the feasibility of CMS’ proposed process for tracking and enforcing its requirement that a non-network plan have sufficient access to providers who accept its benefit amounts as payment in full.
“Before any finalization, CMS must clarify: (1) what constitutes adequate access and how that meets network adequacy requirements, including for essential community providers; (2) how CMS will enforce adequate access on an ongoing basis; and (3) how consumers will be protected from balance billing,” they wrote.
The groups closed their missive with warnings that the non-network plan proposal would threaten the individual market’s long-term stability by pulling away healthier enrollees, distorting risk pools and introducing downstream consequences like a rise in uncompensated care. They called for the agency not to finalize the approach, or at least delay it and tap stakeholders for additional input.
The American Hospital Association, in its own letter on the proposed rule, flagged similar concerns that enrollees may not be fully informed of the plans’ financial risks and that “attestations alone [of sufficient provider access] are not enough and can limit access to care.”
The group suggestions included requirements that the plans “develop and demonstrate either that they have financial agreements with providers in their market that will accept the plan’s specified amount as payment in full or that the plan has obtained pricing information from providers in the market showing that the plan’s specified amounts meet or exceed the prices charged by a specified percentage of those providers.”
QHP status for non-network plans was only one component of the proposed rule’s broader push to broaden the types of plans competing on the exchanges. Other proposals included ditching a Biden administration regulation limiting insurers to two nonstandard plan designs per metal level, and expanded eligibility for so-called “catastrophic coverage.”