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November 30, 2023 – I hope you all had a great Thanksgiving! Regs & Eggs is back after a week of enjoying Regs & Turkey Legs and appreciating the regulatory policies we are thankful for.
Before the Thanksgiving holiday, the Centers for Medicare & Medicaid Services (CMS) issued two proposed regs that would make changes to certain health insurance plan policies starting in 2025: one impacting Medicare Advantage (MA) health plans and those that offer prescription drug coverage under Medicare Part D, and the other impacting health plans that operate in the federal and state “Marketplaces” (which were put into place by the Affordable Care Act). The MA and Marketplace regulations are very different, since each market has unique rules and requirements and covers populations with different risk profiles and healthcare needs. However, there are common themes in both regs that are worth exploring. Overall, it seems apparent that CMS uses its authority to regulate health plans in both MA and the Marketplaces as an opportunity to carry out some of its key policy priorities.
Protecting Enrollees from Misleading Marketing Practices
One overlapping priority is to protect consumers from what CMS believes to be misleading or fraudulent marketing practices to steer individuals into specific health plans. This priority is front and center in the MA proposed reg. CMS proposes to limit the amount that third-party agents and brokers can be paid by plans. CMS would set a compensation limit that agents and brokers can be paid regardless of the plan the beneficiary enrolls in, in order to “address[] loopholes that result in commissions above this amount that create anti-competitive and anti-consumer steering incentives.” CMS also proposes to prohibit contract terms that allow “marketing middlemen” to receive bonuses based on the number of beneficiaries that enroll in certain plans.
In the Marketplace reg, CMS proposes to require states that operate their own Marketplaces to have a centralized enrollment platform to help individuals enroll in place and determine whether they are eligible for financial assistance. CMS also proposes new requirements around Marketplace call centers, with the goal of ensuring that individuals are able to get the help they need to enroll in plans. Like the MA reg, the Marketplace reg includes a proposal related to agents and brokers. CMS proposes to apply some of the federal Marketplace agent and broker requirements to state-operated Marketplaces as well. In CMS’s view, these standards would help ensure that individuals receive all the pertinent (and accurate) information they need to choose the best possible health plan.
It is important to note that this Administration previously reversed a Trump-era policy that would have allowed states to rely on private sector entities to establish independent websites to enroll individuals into health plans. Stakeholders had expressed concerns about moving away from a centralized government-operated website that consumers could trust to offer healthcare coverage that meets all Affordable Care Act requirements. They believed the (now reversed) policy would increase the risk that consumers might mistakenly purchase less comprehensive and potentially more expensive healthcare coverage from non-sanctioned private websites. While this policy has been overturned, CMS continues to implement new policies that the agency believes will help prevent consumers from being misled and from purchasing health plans they don’t understand or don’t want.
Increasing Access to Care
Another theme common to both regs is increasing access to healthcare services by expanding network adequacy requirements. Over the last several years, CMS has broadened network adequacy requirements in both MA and the Marketplaces to help address a concern that more health plans are implementing narrow networks. In the MA reg, CMS proposes to add a new category under the MA plan network adequacy standard called “Outpatient Behavioral Health.” This category would include marriage and family therapists and mental health counselors, Opioid Treatment Program providers, Community Mental Health Centers, addiction medicine physicians, and other providers who deliver addiction medicine and behavioral health counseling or therapy services in Medicare.
In the Marketplace reg, CMS proposes to require state-operated Marketplaces to establish quantitative time and distance network adequacy standards that are at least as stringent as the federal Marketplace time and distance standards. This would ensure that all individuals who receive their coverage from a state or federal Marketplace have the same access to specific types of clinicians and facilities.
Simplifying Enrollment Options
In both regs, CMS proposes changes to help streamline enrollment into health plans. In the MA reg, CMS’s effort focuses on aligning coverage for individuals who are dually eligible for Medicare and Medicaid (often called dual-eligibles”). CMS proposes to create a once-per-month special enrollment period to allow dually eligible individuals to elect an integrated dual-eligible special needs plan (D-SNP). In the Marketplace reg, CMS proposes to align effective dates of coverage for individuals who select a plan during a special enrollment period. This proposal would help ensure that individuals do not experience an unexpected gap in coverage. CMS also would limit changes to plan designs in 2025 in an attempt to standardize plan options in the Marketplace.
Lowering Prescription Drug Out-of-Pocket Costs
Finally, both regs include proposals aimed at decreasing the amount that individuals spend out-of-pocket on prescription drugs. While the proposals are very different, it’s fair to say they both support this key priority of the Biden Administration. The MA reg would allow Part D plans to make certain formulary substitutions of biosimilar biological products without prior CMS approval. This proposal, in CMS’s view, would allow enrollees to have quicker access to cheaper drug options. In the Marketplace reg, CMS proposes to codify its current policy that “prescription drugs in excess of those covered by a State’s EHB (essential health benefit)-benchmark plan are considered EHB. As a result, they would be subject to requirements including the annual limitation on cost sharing and the restriction on annual and lifetime dollar limits….unless the coverage of the drug is mandated by State action and is in addition to EHB . . . , in which case the drug would not be considered EHB.” Some have interpreted this proposal as an attempt to eliminate “copay maximizer programs.” Critics of these programs have argued that health plans use them as a way to get around the annual limitation on cost sharing requirements imposed by the Affordable Care Act and pass more drug costs on to consumers.
These are the common themes and policies that jumped out to me, but please let me know if you identified others. It will be important to keep these areas in mind going forward, as CMS will likely return to them and propose targeted changes and reforms in future regs.
Both the MA and Marketplace proposed regs are out for public comment. Comments on the MA reg are due on January 5, 2024, and comments on the Marketplace reg are due on January 8, 2024.
Until next week, this is Jeffrey saying, enjoy reading regs with your eggs.
For more information, please contact Jeffrey Davis. To access the full archive of Regs & Eggs, visit the American College of Emergency Physicians.
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