HARRISBURG, PA — Insurance Commissioner Jessica Altman sent a letter to the Centers for Medicare and Medicaid Services (CMS) on its proposed Notice of Benefit and Payment Parameters for the 2020 coverage year of the Affordable Care Act (ACA). In the letter, Altman reiterated her strong support for the existing practices and raised concerns over the proposed changes’ effect on premiums.
CMS asked for comment on several existing ACA pieces. Altman expressed her support for the continuation of “silver loading,” which enables issuers to increase premiums on silver-level plans to compensate for the increased actuarial value that the plans provide to enrollees. Pegging premium increases to the second-lowest-cost silver plan allows tax subsidies to rise along with premiums, protecting approximately 80 percent of Pennsylvania enrollees from premium increases. She also expressed her strong support for the continuation of automatic re-enrollment for ACA participants, which means people keep coverage even if they don’t take any action during ACA open enrollment season.
Altman commended CMS’ continued support for coverage for Medication-Assisted Treatment (MAT) for opioid use disorder. The notice reminds issuers of the requirement to cover MAT for opioid use disorder on par with coverage of MAT for other conditions. This matches the work the Insurance Department is doing to increase access to MAT.
Also, the notice proposes changes to drug formulary coverage, including proposing to allow insurers to add a generic equivalent of a drug to a formulary in the middle of a plan year. It would also allow insurers to exclude a brand name product from the Essential Health Benefits if an issuer covers both the brand name drug and its generic equivalent, though insurers would still be required to allow patients to seek exceptions only if the brand name product is medically appropriate.
“While we appreciate this proposal as a way to make health care more affordable, changing a drug’s availability and cost-sharing in the middle of a plan year has the potential to be disruptive for individuals who rely on a formulary at the time of purchase to include access to the same drugs throughout the plan year,” Altman said. “In addition to adding comprehensive notice protections for consumers, we encourage CMS to consider the mid-year exclusion of a drug from Essential Health Benefits to be an adverse benefit determination that would trigger an enrollee’s right to appeal.”
The notice also proposes to update the way the premium adjustment percentage is calculated, which is the factor used to determine the annual adjustment in the amount subsidized marketplace enrollees contribute to plan premiums, the cap on annual out-of-pocket spending, the amount issuers pay via the health insurance tax, and the fine for employers who fail to offer affordable coverage to their employees. The update to the methodology would change the measure of premium growth from only employer plans to the premium growth across all private plans.
“We have concerns that the abrupt transition from measuring only employer plans’ growth to measuring all private plans will have unintended consequences,” Altman said. “We urge CMS to employ a more gradual transition to using individual market premiums in the formula for the premium adjustment percentage. This approach would help avoid a reduction in premium tax credits, and thus an increase in the premiums paid by consumers receiving tax subsidies, so large in any one year that it causes a significant number of people to become uninsured, regressing on the coverage gains that we have worked so hard to achieve.”
Finally, Altman raised concerns about the notice’s proximity to the rate filing deadlines and recommended that future notices be sent in the fall prior to the filing deadline, similar to previous producing filing cycles, to provide issuers with certainty and allow adequate time to prepare product filings.
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