Insights

On Oct. 27, 2017, CMS proposed standards for issuers and exchanges for plan years beginning on or after Jan. 1, 2019. The rules are intended to increase flexibility in the individual market, improve program integrity and reduce regulatory burdens associated with the ACA in the individual and small group markets. The specific proposals are discussed below.

• Essential Health Benefits (EHB) Benchmark Plans. Under the proposed rules, states would have greater flexibility in how they select their EHB benchmark plans for plan year 2019 and beyond. A state’s benchmark plan directly impacts a group health plan’s design in that it serves as a reference plan that defines the scope and limits applied to EHBs. Beginning in 2019, states would be able to select a new benchmark plan annually and would also be able to substitute categories of benefits from another state’s EHB benchmark plan.
• Small Business Health Options Program (SHOP). The proposed rules would relax the requirements for interested small businesses to enroll in the SHOP online. If finalized, small businesses who desire to participate in the SHOP would have the option to utilize a broker rather than use the online enrollment platform. Additional information on this proposal can be found in our Nov. 14, 2017, Compliance Corner article entitled, “CMS to Allow More Flexibility for Small Businesses Enrolling Through the SHOP.”
• Stand-Alone Dental Plans (SADP). Effective in 2019, SADPs wouldn’t be required to meet any certain actuarial valuation. This rule is intended to increase the number of options and plan designs available to consumers.
• Medical Loss Ratio (MLR). Rather than an insurer tracking and reporting their actual Quality Improvement Activity expenses, they’d be able to use a standardized amount based on 0.8 percent of the insurer’s earned premium for the year. This could affect the frequency and amount of MLR rebate checks distributed by insurers.
• Maximum Out-of-Pocket Annual Limits. The proposed maximum out-of-pocket limit for 2019 would be $7,900 for single coverage (up from $7,350 in 2018) and $15,800 for family coverage (up from $14,700 in 2018).

Lastly, CMS encouraged insurers to offer more qualified high deductible health plans to HSA-eligible individuals. This is consistent with several proposed congressional bills that would expand HSA funding.

The rules are only in proposed format now and won’t be effective until final regulations have been released unless CMS states otherwise.

HHS Notice of Benefit and Payment Parameters for 2019 »
Notice of Benefit and Payment Parameters, Fact Sheet »