The Centers for Medicare & Medicaid Services (CMS) has proposed a framework for the federally-facilitated exchange in a draft letter, outlining the agency's tentative plans for certification, networks, rate review and consumer support.
Some industry observers have been saying for a while that the details of the federal HIX were looking murky; some have even wondered if an implementation delay might be beneficial, considering the federal government's mammoth task in managing the exchange in 26 states.
But now, as public comment on the draft letter to qualified health plan issuers closes March 15, it is "perhaps the clearest sign to date that the FFE is in fact going to happen, and will arrive on time, " Washington and Lee University health law professor Timothy Jost blogged on Health Affairs recently.
Authored by CMS's Center for Consumer Information and Insurance Oversight (CCIIO), the letter reiterated the agency's plans to largely rely on states for qualified health plan (QHP) certification, to avoid duplicative reviews -- although only to the extent state reviews are consistent with federal baselines, which may not be the case in some of the states that will have federal exchanges.
In states that do not meet the CMS's baseline for "network adequacy" -- meant to ensure health plan members have provider choices -- the agency is proposing accepting an insurer's accreditation, either commercial or Medicaid. Currently unaccredited issuers would be required to submit an access plan as part of applying to be a qualified health plan.
The agency says it plans to monitor network adequacy by tracking consumer complaints or gathering network data from "any QHP issuer at any time."
For the essential community providers -- such as federally qualified health clinics, Indian providers and public or nonprofit hospitals -- CMS is proposing a compliance formula that accounts for the providers' geographic variation and also gives insurers some flexibility.
To meet safe harbor standards, the QHP would have to demonstrate that at least 20 percent of essential community providers in the health plan's service area are included in the network, and they'll have to offer contracts to all available Indian providers and at least one essential community provider in the service area from six categories, including family planning clinics and HIV/AIDs centers.
To meet minimum compliance for essential community provider requirements, issuers would have to include at least 10 percent of area community providers in their networks, and submit a "narrative justification" demonstrating adequate services for low-income and previously underserved enrollees.
The federal exchange is required to consider all rate increases when certifying QHPs, and CMS is proposing basing its determination on insurers' data and actuarial justifications, as well as "any recommendations provided to CMS by the applicable state regulator about patterns or practices of excessive or unjustified rate increases and whether or not particular issuers should be excluded from participation in the exchange."
In the coming years, CMS says it may also consider factors such as rate growth, both inside and outside the exchange.
The agency said it's aiming to coax into the exchange rates neither too high nor too low. In addition to avoiding market disruptions, CMS says the QHP rates are especially important -- most notably the second lowest cost silver plan -- because they'll directly impact the tax credits and thus federal spending.
As part of its goal to reduce duplicative reviews, CMS says it anticipates integrating state and CMS rate reviews into QHP certification processes. To "identify rates that are relatively high and low compared to other QHP rates in the same rating area," CMS is proposing outlier tests on QHP rates. The agency says it does understand "that identification of a QHP rate as an outlier does not necessarily indicate inappropriate rate development," and so it's planning to work with state entities to further determine if the rates are justified.
In the area of consumer choice and service, CMS says it wants to ensure that prospective buyers can differentiate between plan offerings and prices -- something inherently difficult considering the nature of essential health benefit requirements -- while at the same time insuring that "one issuer does not impede competition by submitting a number of very similar QHPs that monopolize virtual 'shelf space.'"
To balance the two goals, CMS is proposing a benefit design review with two parts: determining "the extent to which each potential QHP is substantially different from other QHPs of its plan type" in service areas, provider networks, premiums, cost sharing and pharmaceutical drug formulary structure; and determining whether "consumers would likely be able to distinguish the particular plan from other QHP offerings from the same issuer in a given service area."
A $50 difference in the annual deductible between two QHPs that otherwise have identical cost sharing and covered benefits would be one example of a QHP CMS would flag for potential amending. Another would be a significant difference in annual maximum out-of-pocket limit when two QHPs with otherwise identical cost sharing and benefits.
CMS has also proposed a tentative consumer enrollment process. Individuals applying for coverage will learn their premium eligibility, compare products and select a plan on the federal exchange website. They'll then be directed to the insurers' websites, to pay premiums (based on their tax credits) and provide any needed information, like designating a primary care doctor.
CMS is proposing that insurers and the federal exchange share data on enrollments, updates and cancellations on a daily basis during enrollment periods, with each consumer having a unique identifier that changes if and when s/he changes health plans. On a monthly basis, the exchange and insurers will share full enrollment files under the proposal, to prevent record discrepancies.
For customer service, CMS will be operating a call center, available in both English and Spanish, that will be a source for mostly basic information about the exchange, directing consumers with more detailed questions to either HIX navigators or the insurers.
While federal and state exchanges will have pretty extensive consumer support -- with navigators and in-person assistance designed to serve as consumer advocates and mediators where there are problems -- CMS is encouraging insurers to plan their own robust HIX customer service.
Insurers selling on the exchange will also have to publish provider directories and investigate and resolve consumer complaints. And as part of meaningful access provisions, they're also being required to provide free oral interpretation and written translations for limited English-proficient speakers. As Timothy Jost, the health law professor, noted, CMS has not specified which languages languages insurers will have to offer interpretation services for.