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Updated May 17, 2017

CMS Passes Rule That Makes Enrollment Easier

Enrollment just got a lot easier and a lot faster.

If you were one of the millions of people who enrolled in your own health insurance the past two years and noticed that the experience was completely different and far more frustrating, you were not alone. During the 2015 and 2016 open enrollment period, consumers were able to hop on to an online broker’s website, pick a plan, and start and finish their application pretty seamlessly.

During last year’s open enrollment period, the online enrollment process was painful. Consumers that wanted to give the shopping and application process a shot on their own would start on a website, shop for a plan, start an application and then be transferred to Healthcare.gov to verify their income. If they were one of a tens of thousands of people on Healthcare.gov at that moment, the process was slowed down even more. When and if Healthcare.gov verified their income, the consumer would then be sent back to the original website and their original application, presuming they followed instructions properly, to finish everything up.

The process to complete enrollment over the phone was slightly less painful because the frustration with dealing with Healthcare.gov’s income verification process was placed on the health insurance agent on the phone and not the consumer, but the wait time existed either way.

Many people complained and many people ultimately didn’t enroll because of this process. Thankfully CMS learned from this experience and announced today, May 17, 2017, that this process, which was called the Double Redirect by the industry, is gone for the 2018 enrollment period.

This means that consumers and licensed agents can now complete an application, including the income verification piece, on one website, without interacting with Healthcare.gov. In order to complete the income verification piece, online brokers will use a proxy or online connection to feed Healthcare.gov your income information on your behalf, behind the scenes, meaning that you’ll never know that it’s happening.

This new, streamlined enrollment process is only available to enrollments during open enrollment though. Complicated enrollments that require a lot of supporting documents and enrollments outside of the open enrolment period will have to deal with the old, Double Redirect process.

CMS also explained that this new, direct enrollment process is only a temporary fix to improve enrollment for this upcoming season but that a larger, more efficient process is planned for future enrollments.

 

Updated April 24, 2017

CMS Issues Rule to Stabilize the Market

On April 13th, the Centers for Medicare and Medicaid Services (CMS) released a final rule that is designed to help stabilize the health insurance marketplace. Over the past couple of seasons, many carriers chose not to participate in Obamacare or have threatened to stop participating because they said that the market was not stable, they were unable to project budgets and they were losing more money on that segment of their business than anticipated. As a result, many Americans were left with fewer health coverage options when it came time to enroll in a new plan.

Although President Trump campaigned on a plan to repeal and replace Obamacare, the GOP was unable to get this done as quickly as anticipated, so Americans are still left with rising costs and limited options and many carriers are still debating whether they want to offer coverage next year. Carriers have made it clear though that there are a few things that the Administration can do immediately to make things better. The rule issued by CMS on April 13th took steps to satisfy those requests.

Here’s a synopsis of what was changed:

  • A shortened OEP: The open enrollment period in 2018 will begin on November 1, 2017 and will end on December 15, 2017. This means that people will have 45 less days to enroll in a plan, so procrastinating will not be a good idea.
  • Applying the binder payment to an outstanding payment: If you owe your carrier money for premium payments from the past year, that carrier may apply the first binder payment (the payment that you make when you submit your application) made for your renewed plan or the new plan to the outstanding bills from the prior year. This can happen if you enroll during the open enrollment period or during a special enrollment period. If you change your carrier, the new carrier cannot require you to pay all of your past due premiums to the former carrier in order to get coverage with the new carrier. CMS believes that people will keep up with their regular monthly payments if they knew that they cannot get new coverage until they pay for the old coverage. If more than one payment is due to the carrier, the carrier should look to state law to figure out whether they can require additional payments before the new plan is effective.
  • A more rigorous pre-enrollment verification process: If you experience a qualifying life event that permits you to enroll in a new plan outside of the open enrollment period, you will have to go through what is now a more in depth “pre-enrollment verification” process. This will start in June 2017. This new process would allow Healthcare.gov to hold the consumer’s application for health insurance until the circumstances of their qualified life event were verified. This means that the longer you wait to get Healthcare.gov the requested paperwork to verify your QLE (you’ll have only 30 days after you submit your application to do so) the longer it will take to complete your application. After your QLE is confirmed and verified with supporting paperwork, the application would go to the carrier and the carrier would give you coverage. In prior years, Healthcare.gov would ask for the paperwork verifying your QLE after the coverage was issued, if they even asked for supporting documentation at all, so your coverage start date was much sooner than it can be now under this new process.
  • Needing additional coverage QLE limitations: If you get married or have a child and you need to get coverage for that newly added person, you must add that person to the coverage that currently exists. There are a few exceptions to this rule, but generally you may not change your carrier or even the plan tier just because you had a qualified life event that resulted in needing additional coverage.
  • Future coverage can be contingent on payment of outstanding balance: If a person was terminated from coverage for non-payment of their bills by a particular carrier, that carrier can deny future coverage, even if it is a year or more later, due to the fact that there is an old, outstanding balance. If the person pays the outstanding balance or makes some agreement with the carrier to pay some portion of it, the carrier can then choose to insure that person again. The carrier must follow state law, if there is one that addresses this issue.
  • Loss of coverage does not trigger an SEP: Loss of coverage due to non-payment does not trigger a Special Enrollment Period, meaning that if you lose health coverage because you didn’t pay your bills, you do not have a qualified life event that would allow you to enroll in a different plan. You will simply be uninsured until the next enrollment period.
  • Explore continuous coverage requirements: HHS is currently exploring policies that would require consumers to have continuous coverage. For instance, it is looking into rule changes that would require consumers to prove that they had coverage for the previous 6 or 12 months if they want to get new coverage during a Special Enrollment Period. If a person did not have continuous coverage for the required period, they would not be able to get insurance until the next open enrollment period comes around. These changes to the Special Enrollment Period do not apply to people who have a small group health insurance plan under SHOP.
  • Amend the percentage variation for average cost coverage per plan tier: Previously, on average, a carrier must offer a bronze plan that covers 60% of the costs, a silver plan that covers 70% of the costs, a gold plan that covers 80% of the costs and a platinum plan that covers 90% of the costs. The law allowed for a small variation in the percentage of costs covered, but it was not enough to give carriers any flexibility. Under the new rule that CMS issued, the required percentage of cost coverage would be adjusted, which would then allow carriers to create different kinds of plans at different cost-levels. This should mean more choice for consumers. Under the new calculation model, a silver plan (excluding the benchmark silver plan that used to determine subsidy amounts), a gold plan or a platinum plan’s costs could vary between -4/+2 percentage points of the standard level – 70%, 80% and 90%. Bronze plans have the flexibility to cover between 56% and 65% of the costs (-4/+5 percentage points). This rule does not change the coverage percentage required by the benchmark silver plan that every carrier who participates in the market must offer. So, for example, a carrier’s gold plan could cover between 76 – 82% of the costs (-4/+2 percent of the old benchmark). A gold plan that covers 76% of the costs may be cheaper than a silver plan that covers 82% of the costs. This kind of flexibility would allow the consumer to decide how much coverage they want and how much money they want to spend. It may also allow a consumer to pick a higher tiered plan for a little less money. This rule also acknowledges that the states have ultimate authority over the coverage requirements of insurance plans and they could choose to change the percentage requirements also. This flexibility will go into effect for plans offered on January 1, 2018, which means they will be available during the 2018 open enrollment period, which begins on November 1, 2017.
  • Defer to the State’s review of a plan’s network adequacy: Previously, HHS would independently verify the fact that a plan’s network was adequate and met all of the requirements of the law. This review was technically unnecessary because the state already performed this verification. This new rule now defers to the state’s review of the network when validating a plan and it is designed to save taxpayer money from paying for a duplicative review. If a state does not have the means to review the adequacy of a plan and its network or to maintain records on whether a plan continuously meets the required criteria, this rule allows three, different accrediting entities to be used to do this work.
  • Decrease the plan contract requirements regarding Essential Community Providers: Previously, carriers were required to contract with at least 30% of available essential community providers, who offer medical care to predominantly lower-income and medically underserved communities. The purpose of requiring carriers to contract with a certain percentage of essential community providers is to ensure that lower-income and medically underserved communities not only have access to health insurance that would actually cover their medical costs, but also have coverage that would provide them a place to get medical care, even if their community lacked a large medical practice, specialty medical care facilities or even a hospital. Under this rule, that percentage is decreased from 30% to 20%, meaning that if there are 100 essential community providers in a given service area, a carrier must contract with and offer coverage for care provided by 20 of them instead of 30 of them. A list of medical providers that qualify as an essential community provider is maintained by HHS and this rule provides guidance to carriers who want to add to this list. It also provides guidance on how to submit an explanation if the carrier is unable to contract with at least 20% of essential community providers in a given service area but still want to offer a plan in that area. One of the main reasons that the percentage was decreased from 30% to 20% was because previously, many carriers were unable to meet the 30% threshold and spent a lot of administrative dollars providing explanations. Taking away this burdensome administrative task should help, even in a small way, to bring down health insurance costs.

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