HHS Proposes 2021 Payment Parameters

February 19, 2020

On February 6, 2020, HHS issued the proposed annual Notice of Benefit and Payment Parameters Rule for 2021. This Notice is issued annually, and once final adopts certain changes for the next plan year. While the proposed rule primarily impacts the individual market and the Exchange, it also addresses certain ACA provisions and related topics that impact employer-sponsored group health plans. Highlights include:

  • Annual Cost-Sharing Limits. As background, the ACA requires non-grandfathered group health plans to comply with an out-of-pocket maximum on expenses for essential health benefits. This maximum annual limitation on cost-sharing for 2021 is proposed to be $8,550 for self-only coverage and $17,100 for family coverage (an increase from $8,150 and $16,300 for self-only/family coverage respectively in 2020).
  • Drug Manufacturer Coupons. Stakeholders have broadly responded with confusion on how to treat drug manufacturer coupons in relation to the annual limit on cost-sharing. HHS proposes it will permit – but not require – plans and insurers to count direct support offered by drug manufacturers to enrollees for specific prescription drugs toward the annual limit on cost-sharing. Further, HHS proposes to interpret the definition of cost-sharing to exclude expenditures covered by drug manufacturer coupons.
  • Excepted Benefit HRAs. HHS proposes to require that excepted benefit HRAs (EBHRAs) offered by non-federal governmental plan sponsors provide a notice to participants. This proposed notice requirement is in response to comments on recent HRA rulemaking that individuals should receive clear information about their HRAs. The content of the notice would generally be consistent with the content of SPDs required by ERISA and include information such as the conditions of eligibility to receive benefits under the HRA, a description of annual or lifetime limits on benefits under the HRA, and a summary of the benefits.

Once final, employers should review the regulations and implement any changes needed for their 2021 plan year.

Proposed Rule »
Fact Sheet »