On February 15, the Department of Health and Human Services (HHS) issued a proposed rule focused on stabilizing the individual health insurance marketplaces, as Congress debates the repeal and replacement of the Affordable Care Act. Among other provisions, the proposed rule would notably:

• Guaranteed Issue: Allow insurers to condition enrollment on the repayment of all past-due premiums for coverage under the same product or a different product offered by the same insurer in the previous 12 months;
• Open Enrollment Period: Shorten the 2018 open enrollment period from November 1, 2017—January 31, 2018 to November 1, 2017—December 15, 2017; and
• Special Enrollment Periods (SEPs): Restrict the use of SEPs by expanding pre-enrollment certification, limiting the ability to use a SEP to change plans, and limiting eligibility and exception circumstances, among other restrictions.

In light of the compressed timeframe insurers face to finalize rates for 2018, the public had only 20 days to comment on the proposals before HHS considers stakeholder input and releases a final rule. When the comment period closed at 11:59pm on March 7, 3,938 comments had been submitted by health insurers, state officials and marketplaces, consumer advocates, and thousands of private citizens. To better understand the concerns and recommendations of health insurers, CHIR pulled a sample of comments submitted by both large and small insurers, including the perspective of two of their national trade associations, as follows:

• Aetna
• America’s Health Insurance Plans
• Anthem
• Blue Cross Blue Shield Association
• Centene Corporation
• Cigna
• EmblemHealth
• Kaiser Permanente
• Medica
• Minuteman Health
• Molina
• MVP Health Care
• Oscar
• UnitedHealthcare

In future posts, we will review comments submitted by state-run health insurance marketplace officials and consumer advocates.

Guaranteed Issue: The Vast Majority of Insurers Support Conditioning Enrollment on the Re-Payment of Premiums

Nearly every insurer that commented on the guaranteed issue proposal supported CMS’ interpretation that insurers should be allowed to collect outstanding premiums before allowing a consumer to enroll in coverage with the same insurer. EmblemHealth stated that the provision “would be helpful in stabilizing” risk pools, while other insurers asked for clarification as to whether the provision would apply across individual, small group, and large group markets.

On the other hand, Oscar and UnitedHealthcare felt that the proposal did not go far enough. Oscar recommended that CMS expand the standard to allow insurers “to refuse to effectuate coverage for individuals who have unpaid coverage with a different insurer.” Similarly, United questioned whether the policy should apply only to premium amounts due for the prior 12 months. Rather, the company urged CMS to go further, saying:

“We see no reason for such limitation and recommend that insurers be permitted to deny an application if the individual owes any amounts, including premiums owed for the past three months of a prior coverage year or unpaid premiums for any prior coverage year.”

Open Enrollment Period: Roughly Half of Insurers Support Shortening the Open Enrollment Period

Of the fourteen comments examined, roughly half of the insurers support reducing the open enrollment period to a 45-day maximum. Anthem wrote that a shorter period would encourage individuals to obtain coverage early and reduce consumer confusion, as the time period would more closely align with enrollment periods for Medicare Advantage, Medicare Part D, and most forms of employer coverage. However, the issuer requested that companies be granted the flexibility to reach out to consumers to provide timely education. Likewise, AHIP noted that consumer education and outreach via assister entities would be crucial for increasing awareness during the abbreviated period.

Still, several insurers raised concerns that the reduced period would put an undo strain on enrollment and the capacities of state-based marketplaces. Emblem commented, “…we are concerned that a December 15 cut-off might preclude a large number healthy people from signing up,” and therefore, recommended that state-based marketplaces be given some flexibility to expand the open enrollment window. Minuteman, Molina, and MVP Health expressed similar concerns and called for varying degrees of state flexibility, while—in direct contrast—United, Oscar, Medica, and Centene asked that CMS not grant state-based marketplaces any leeway to expand the period.

Special Enrollment Periods: Insurers Overwhelmingly Support “Stricter Validation and Verification” of SEPs

Most insurers expressed strong support that federal and state marketplaces follow uniform requirements for verifying “100 percent” (Molina) of SEP applications, on- and off-exchange, in addition to many insurers requesting that they be permitted to “review the documentation and challenge the determination by the Exchange, as applicable” (United). While most insurers urged CMS to fully implement the verification process beginning June 2017, some insurers acknowledged that the time frame might be too arduous for state-based marketplaces to meet. Though several insurers noted that stricter enforcement of SEPs was necessary to prevent “gaming” by some bad actors, others—like Centene—still encouraged CMS to “educate consumers on the process,” in order to alleviate confusion.

Take Away: While insurers pushed back and called for clarification on various provisions of the market stabilization regulation, most expressed support for three of the major changes proposed. Insurers argue that these changes are necessary to steady a market that has become increasingly turbulent and to smooth the transition until the politics of repeal are determined. Stay tuned however, for coming analyses of arguments from consumer advocates and marketplace officials, many of whom strongly disagree with the insurers’ prescriptions for market stabilization.