Our Take on the NBPP Proposed Rule

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This past Friday, the Centers for Medicare & Medicaid Services released the proposed Notice of Benefit and Payment Parameters (NBPP) for the 2019 plan year.
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This annual rule updates guidance and regulations related to exchanges as well as the broader individual, small group, and large group insurance markets. This is the first NBPP to be issued under the Trump administration.

This year’s NBPP comes as carrier participation has declined significantly for the 2018 plan year, with nearly half of all counties having only one participating Insurer in the exchange market. In addition, consumers shopping on the exchanges are likely to face significantly higher premiums in most states. Avalere experts attribute those premium increases to a number of factors, including elimination of cost-sharing reduction (CSR) payments, lower than anticipated enrollment in the marketplace, limited insurer participation, insufficient action by the government to reimburse plans that cover higher cost enrollees (e.g., via risk corridors), and general volatility around the policies governing the exchanges.

Specifically, the NBPP addresses:

  • Potentially significant reforms to essential health benefit requirements
  • Out-of-Pocket Maximums, which could adjust the limit for individual coverage to $7,900 and $15,800 for family coverage-the highest single year increase since the MOOP was created in 2014
  • Modifications to enrollment standards for special enrollment periods and tax credit eligibility for consumers-especially those with incomes lower than the poverty level who aren’t eligible for Medicaid
  • Changes to risk mitigation programs, including methodology, state flexibility, risk adjustment data validation, and reinsurance eligibility
  • Issuer flexibility, which could eliminate meaningful difference standards and remove duplicate federal oversight for network adequacy
  • New powers for the Health and Human Services Secretary to lower Medical Loss Ratios that could allow issuers to increase their profitability

Final comments for the rule are due to HHS by November 27.

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