2019 Final Regulations for EHBs, OOPMs and Marketplace Updates

Update, May 21, 2018: 
ACA Affordability Threshold – Adjustments 2014 through 2019

• 2014 Affordability 9.5%
• 2015 Affordability 9.56%
• 2016 Affordability 9.66%
• 2017 Affordability 9.69%
• 2018 Affordability 9.56%
  • This is the first time since the implementation of the ACA rules that the affordability contribution percentages have been reduced.
• 2019 Affordability percentage – 9.86% (see IRS Rev. Procedure 2018-34).

Original post/article–>
The Department of Health and Human Services (HHS) issued final regulations on April 9, 2018, related to guidance on the Affordable Care Act (ACA) provisions which include Essential Health Benefits (EHBs), Out-of-Pocket (OOP) Maximums, and Marketplace updates and reforms. These final regulations are generally effective for plans and plan years beginning on and after January 1, 2019.
Final rule improvements include:

• greater flexibility to states for determining EHBs,
• reduction to some regulatory requirements in the individual and small group markets, and
• provides annual benefit provision updates.

These final regulations are primarily focused on individual and small group Marketplace updates and reforms, but the EHB benchmark plan changes will have some effect on large group health plans as well.
Essential Health Benefits (EHBs)
For plan years beginning on and after January 1, 2020, states can either follow their current rules and maintain the 2017 benchmark plans or they may select a new EHB benchmark plan annually from one of the following:

• Choose another state’s 2017 benchmark plan – allows states to select another state’s 2017 benchmark plan and implement the plan benefits and limits to their own EHB standards, such as changing benefits with dollar limits to non-dollar limits.
• Replace one or more of the 10 required EHB categories of benefits under its current 2017 benchmark plan with the same categories from another state’s 2017 benchmark plan – giving states the ability to make precise changes to their 2017 benchmark plans at the coverage detail level.
• Otherwise, select a new set of benefits to become its benchmark plan – provided the plan meets other specified requirements.

These three options are also subject to additional requirements, including two scope of benefits conditions which confirms that their new/modified benchmark plans provide:

• scope of benefits that is equal to, or greater than, the scope of benefits provided under a “typical employer plan,” and
• no more generous than the most generous of a set of comparison plans.

HHS’s final guidance can be found here. States have until July 2, 2018 to submit their 2020 EHB benchmark plan to the Centers for Medicare and Medicaid Services (CMS).
2019 Out-of-Pocket (OOP) Maximums (applied to all non-grandfathered plans, regardless of size or funding type)

• Individual Coverage – $7,900
• Family Coverage – $15,800

Marketplace Regulations
Marketplace provisions, effective January 1, 2019:

• Deferring the network adequacy reviews for qualified health plan (QHP) certification to the states
• Loosening the audit process for agents, brokers and issuers who participate in the direct enrollment process
• Updating the risk adjustment model for insurers with high-cost enrollees
• Modifying the requirements for Marketplaces to verify eligibility for, and enrollment in, qualifying employer-sponsored coverage
• Not specifying 2019 standardized plan options (know as simple choice plans)
• Updating special enrollment period (SEP) rules for coverage effective dates specific to SEPs that allow adding or changing dependents
• Adding a new SEP for pregnant women who were receiving coverage through the Children’s Health Insurance Program (CHIP) but lose that access
• Allowing Marketplaces to determine individual affordability exemptions based on affordability of the lowest-cost metal level plan available
• Allowing enrollees to request same-day termination of coverage
• Removing several Small Business Health Options Program (SHOP) requirements for online enrollment

Other Market Reforms

• Streamlining the rate review process for states and issuers, including when rates are posted by the states, increasing the threshold at which rate increases require review from 10% to 15%, and establishing a process for states to request a higher threshold.
• Modifying the Medical Loss Ratio (MLR) rules, including simplifying quality improvement activity reporting requirements for issuers and establishing a process for states to use to request adjustments to the 80% MLR standard in the individual market.

Expanded Individual Mandate Hardships
New hardship exemptions include people who:

• Live in a county, borough, or parish in which no QHP is offered
• Live in a county, borough, or parish in which there is only one issuer offering coverage and can show that the lack of choice resulted in them failing to obtain coverage under a QHP

Sources:
Cigna Health Care Reform Alert: Final Regulations – 2019 Notice of Benefit and Payment Parameters
Final Regulations
HHS Final Guidance
HHS Fact Sheet