- The Biden administration wants to require plans in state-run exchanges set up by the Affordable Care Act to maintain provider networks as extensive as those in federal marketplaces.
- Under a new rule proposed Wednesday, beginning in 2025 plans sold in state-based exchanges and marketplaces that use the HealthCare.gov enrollment website would be required to meet time and distance standards for provider access that are already applied to plans sold on the federal level.
- Insurers that can’t meet those standards would have to justify noncompliance to their state, which would then decide whether that plan should be offered to its residents, according to the rule.
Plan network adequacy is an important factor determining whether patients can actually access needed care, especially given that insurers have been offering smaller networks in recent years, partly in an effort to cut costs. That can make it more difficult for people to find in-network providers.
Both states and the federal government oversee marketplace plan adequacy, but enforcement has been criticized as weak. It’s easy for things to slip through the cracks, and plans say a shortage of providers — especially in rural areas — makes it difficult for them to maintain comprehensive networks.
A recent government watchdog report found 243 out of 375 plan issuers on the federal exchanges weren’t complying with network adequacy standards for the 2023 plan year.
States have also reported issues. Officials from one state told the Government Accountability Office that one of the most common areas of network adequacy noncompliance was plan issuers’ failure to meet time and distance standards.
Those standards are meant to ensure providers are geographically accessible to plan members. The standards require payers to make available at least one provider for a variety of specialties within a certain driving distance.
Now, the CMS wants to apply those standards to plans on state-run ACA exchanges as well. The standards would be calculated at the county level, and would apply to the same provider specialties as in the federally facilitated marketplaces, according to the rule.
Yet exceptions to the standards might be reasonable, based on factors like the local availability of providers, the CMS said.
Regulators are not requiring states to hold plans to other network adequacy standards like including essential community providers and publishing a provider directory.
Wednesday’s proposed rule, if finalized, would also require states launching their own exchanges to use HealthCare.gov for one year before transitioning to their own platform, and require states’ open enrollment periods to match that of the federal exchanges.
It would also require brokers and other entities selling plans on state exchanges to follow federal standards around how to describe benefits and financial assistance, and how they compare ACA-compliant plans with plans sold off the exchanges.
Worries about non-compliant plans have mounted as millions of beneficiaries lose Medicaid during state eligibility checks and search for other coverage. Early signs suggest many of those beneficiaries are turning to the ACA exchanges, during a time of record enrollment for those plans due in part to more federal financial assistance.
The 2025 Notice of Benefit and Payment Parameters enacts less sweeping changes than in prior years. The 2024 rule, for example, closed loopholes to network adequacy standards at the federal level, enacted wait time standards and pared back what products insurers could sell.