- The CMS has finalized proposals aimed at boosting provider availability and revising network adequacy and essential community provider standards for insurers operating on Affordable Care Act marketplaces, according to the 2024 HHS Notice of Benefit and Payment Parameters final rule released Monday.
- The final rule requires that issuers on state and federal marketplaces offer standardized qualified health plans at every metal level except the non-expanded bronze level, and in every service area they offer non-standardized QHPs. However, the agency walked back an initial proposal to limit the number of non-standardized plans that issuers can offer.
- The agency also finalized flexibilities beginning Jan. 1 for consumers losing Children’s Health Insurance Plan and Medicaid coverage, after states were allowed to begin Medicaid redeterminations earlier this month, ending COVID-19 era rules requiring states to provide continuous enrollment in exchange for federal funding.
The final rule comes as a record number of Americans, spurred by COVID-19 incentives, sign up for ACA plans. During the 2023 open enrollment period, a record-breaking 16.3 million people signed up for ACA marketplace coverage, including 3.6 million first-time marketplace enrollees.
Beginning in plan year 2024, marketplace plans must use providers that comply with network adequacy standards, removing a proposed exception stating that adequacy regulations don’t apply to insurers who don’t use a provider network. The final rule also requires insurers to include at least 35% of providers in any given market into their networks, and extends the 35% provider participation threshold to federally qualified health centers and family planning providers.
Issuers will now also be limited to offering four non-standardized options per product network type and metal level in any given service area.
However, the final non-standardized limit is more than the CMS initially proposed in December, when the agency proposed that issuers be limited to offering two non-standardized plan options to decrease a “continuing trend of plan proliferation” for marketplace consumers, according to the HHS. The proliferation has led to an average number of 114 in plans available to Marketplace consumers in plan year 2023, up from 26 in 2019.
The agency estimates that, with the finalized four non-standardized plan issuer limit, the number of available non-standardized plans available to consumers will decrease to around 90.5 in plan year 2024.
In addition, the CMS also backtracked on a section of the proposed rule that aimed to reduce the risk of discriminatory benefit designs and minimize barriers to access for prescription drugs. The proposed rule said issuers of standardized plans must place all covered generic drugs in a generic cost-sharing tier and place all covered brand name drugs in either the plan’s preferred brand or non-preferred brand cost-sharing tiers.
Both the non-standardized plan limit and drug proposals faced backlash from the insurance industry, with payer lobby AHIP writing in comments to the 2024 proposed rule that limiting plan options could “drastically disrupt the Marketplace” in the face of an unwinding COVID-19 public health emergency and Medicaid redeterminations, and urging that the HHS defer to insurers to establish prescription drug tiers.
Also in the rule, mental health facilities and substance abuse disorder treatment centers will now be included as essential community provider categories, and rural emergency hospitals will be added as a provider type in an ECP category. The focus on behavioral health and substance abuse comes after the HHS released guidance to better integrate mental health and substance use disorder treatment into the healthcare ecosystem.