- The CMS will allow individual and small group health plans that are not compliant with ACA rules to remain operational until Dec. 31, 2018, under transitional policy, according to new guidance issued Thursday.
- States will have the control over permitting these policies to continue, the CMS stated.
- The agency hopes the "approach will facilitate smooth transitions from transitional coverage to Affordable Care Act-compliant coverage, which requires a calendar year policy year in the individual market."
The extension is an attempt from the Trump administration to ensure at least some Americans will remain covered if GOP lawmakers repeal and replace the ACA as they plan to. In addition, it inches Republicans closer to accomplishing one of their main goals with healthcare reform - giving states more flexibility. However, it also supports the argument that the government's latest changes to healthcare policy, including a CMS proposed rule aimed at stabilizing the ACA individual market, will favor insurance companies more so than patients.
The pending CMS rule addresses some of the concerns expressed by payers with proposed changes such as increased pre-enrollment verification and a shortened open enrollment period in the individual market. And with the CMS' new guidance, the plans that states can now choose to extend allow payers to charge patients more based on their pre-existing conditions or gender. “It's hard to see how this contributes to the stability of marketplace coverage, although it is apparently what the insurers want,” Tim Jost, an emeritus law professor at Washington and Lee University, told Modern Healthcare.
On the other hand, the guidance will likely be well-received by the hospital industry because the spike in the U.S. uninsurance rate that would potentially come with repealing the ACA will perhaps not increase as much as previously expected if coverage plans are extended. An ACA repeal is expected to lead to massive job losses and cost hospitals $165.8 billion in federal payments. How positive of an impact the guidance will have on hospitals will also depend on when the repeal occurs and when and if a replacement coverage plan is implemented.