The ultimate goal of ACA was to insure more Americans. If the insured rate is the measure of success, then Obamacare succeeded. At least 20 million more people now have health insurance than they did before the law. To improve the uninsured rate, the Obama administration wanted to make it easy for people to sign up. They did so by making the enrollment period longer than usual and making the rules for special enrollments fairly broad.
The proposed regulations intend to tighten up these practices and bring stability back to the market. On Friday, February 17, 2017, the Trump administration released its first ACA regulation, hoping to prevent more health insurance companies like Humana from pulling out of the market exchanges. When big insurers leave the market, it in turn leaves consumers with fewer, and possibly more expensive, plan options.
The Centers for Medicare and Medicaid Services (CMS), which administers the law, claims these regulations will offer flexibility, which will then create stabilization. “This proposal will take steps to stabilize the Marketplace, provide more flexibility to states and insurers, and give patients access to more coverage options,” acting CMS administrator Dr. Patrick Conway said in a statement. “[The new regulation] will help protect Americans enrolled in the individual and small group health insurance markets while future reforms are being debated.”
Many of the insurers are hopeful about these new rules. The Alliance of Community Health Plans, which represents nonprofit insurers, called the regulation “a promising first step.” But what are these promising first steps?
Rule 1: Shorter Enrollment Period
To start, the proposed amendments to Obamacare shorten the open enrollment period (OEP). For the past few years, the enrollment periods have last 3 months, starting November 1 and ending January 31. For the 2018 plan year, the new enrollment period would be Nov. 1, 2017, to Dec. 15, 2017– similar to the Employer-Sponsored Insurance Market and Medicare. As a result, enrollment rates may decrease. Additionally, the shorter enrollment period is intended to force people to prove their eligibility for special enrollment periods (SEPs). According to the CMS press release, this change will “help lower prices for Americans by reducing adverse selection.”
Rule 2: Increased Scrutiny for SEPs
As mentioned above, these changes will require verification and proof in order to qualify for SEPs. If someone experiences any major life changes, i.e. divorce, employment changes, moving, then they have to provide documentation proving their situation in order to change insurance plans post-OEP.
“This proposed change would help make sure that special enrollment periods are available to all who are eligible for them, but will require individuals to submit supporting documentation, a common practice in the employer health insurance market,” CMS said. “This will help place downward pressure on premiums, curb abuses, and encourage year-round enrollment.”
Rule 3: Network Control
Next, the Trump administration plans to return some of the healthcare oversight to the states. As CMS states, “States are best positioned to ensure their residents have access to high quality care networks.”
Under these new changes, states will be able to decide if the networks of providers is sufficient or not. This will save insurance companies money because they can limit their customers to select hospitals and doctors that have agreements with the hospital. Hopefully, as a result, insurance companies won’t leave the marketplaces like Humana.
Rule 4: Unpaid Premium Collection
Another way in which these changes will help insurers save money is by enabling them to collect back payments on unpaid premiums. So in order to receive coverage for the next plan year, beneficiaries will first be required to submit any missing payments. This will incentivize people to always have insurance.
Rule 5: Plan Flexibility
The changes, according to the CMS press release, will lower “the de minimis range used for determining the level of coverage.” By providing insurance companies more flexibility in developing plan benefits, insurers can save money. They can cover fewer areas of health but still maintain a certain metal level.
This not only benefits the insurers but also the consumers. Flexibility for the insurers will mean more varied plan options. It will allow consumers to purchase more customized healthcare instead of being bound by the ten essential benefits. And though this change may increase out-of-pocket costs for consumers initially, the lower premiums would eventually offset the prices.
To accomplish this change, CMS announced it will revise the timeline for the Qualified Health Plan (QHP) certification calendar and rate review process for the 2018 plan year.
General Consensus
As with all politics it seems, there is some controversy revolving around these new rules. Some call it promising, others call it a temporary patch, while some consider it sabotage. Check out our other article to see what people have to say about this new ACA ruling.
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