Key Payer Concerns in Proposed 2023 Benefit, Payment Parameters

January 28, 2022 - Payers are responding to the proposed Notice of Benefit and Payment Parameters for 2023 for the individual health insurance marketplace.

The proposed rule addressed a broad range of issues on the individual health insurance marketplace, from medical loss ratios to health equity data. 

AHIP and the Alliance for Community Affiliated Plans (ACAP) have both responded to the proposed rule with mixed reactions. Some elements they strongly applauded, such as the return to pre-2020 language around discrimination, web-broker display requirements, standards of conduct for brokers and agents, special enrollment period verification, and quality improvement strategy (QIS).

“ACAP appreciates the Administration’s desire to strengthen the integrity of the Marketplaces; our comments are ensuring market stability for o Safety Net Health Plans (SNHPs) and the consumers they serve,” Margaret A. Murray chief executive officer of ACAP, stated in the payer organization’s comments.

“ACAP member plan enrollees are generally low-income populations and we would like to emphasize that the comments herein support SNHPs in their efforts to serve their communities.”

READ MORE: HHS Releases 2023 Payment Notice, Medicaid Waiver Guidance

However, the payer organizations also shared some concerns about the proposed rule. 

“The recent increase in enrollment through the marketplaces is a significant achievement toward ensuring that every American has the financial peace of mind that health insurance provides,” Matthew Eyles, president and chief executive officer of AHIP, explained in the letter preceding AHIP’s comments.

“We are concerned that some of the policies proposed in this Payment Notice may take large steps backward, undermining this hard-won stability and significantly limiting innovation and competition.”

AHIP and ACAP highlighted a couple of key areas of the proposed rule that they would like to see changed in the finalized version.

Risk adjustment

Payers shared concerns about the process surrounding risk adjustment data, from collection to analysis.

READ MORE: Members Find Private Payer Mental Healthcare Networks Inadequate

Under the proposed rule, HHS would collect five new enrollee data points, including ZIP code, plan ID, and subscriber indicators.

AHIP noted that extracting such sensitive data could risk spreading identifiable data. Even if the data points are not made publicly accessible, gathering this information could threaten enrollees’ privacy. Moreover, certain requested factors for risk adjustment—such as race and ethnicity data—are difficult to collect. 

AHIP urged HHS to abandon this idea and search for an alternative.

ACAP asked CMS to remove 2020 External Data Gathering Environment (EDGE) data from the risk adjustment model due to the severe impacts that the coronavirus pandemic had on that year’s data. The payer organization supported EDGE data collection on race, ethnicity, zip code, and subsidy status. 

However, ACAP—like AHIP—also emphasized that collecting race and ethnicity data is difficult.

READ MORE: Social Risk Adjustment Promotes Health Equity In Value Based Care

ACAP took a strong stance on oversight and anti-discrimination enforcement for individual coverage health reimbursement arrangement (ICHRA) plans as part of the risk adjustment model.

On certain factors, the payers did not reject the proposed rule’s approach, but instead asked for more information. AHIP emphasized the need for clarity around timing for reporting the HHS-Risk Adjustment Data Validation (RADV) calculations and the strategy around prescription drug categories (RXC) mapping for drugs with multiple indications.

Standardization, plan choice

HHS has proposed offering standardized individual health insurance marketplace plans in order to streamline enrollee navigation of the healthcare system.

AHIP took a stance against this approach. The payer organization argued that this proposal would discourage innovation. Payers also may have a difficult time implementing standardized structures such as common prescription drug formularies.

According to AHIP, the solution would be to standardize only one level option—the silver level—in each service area. Then, health plans would report on the outcomes of standardization to see if this is an effective approach.

Both payer organizations also voiced some opposition to the proposal to limit the number of health plans available to consumers. The groups stated that such an approach would stunt healthy competition and progress in value-based insurance design. It might also increase the number of plan options, creating more confusion among enrollees instead of streamlining the process.

“As an alternative, we support reinstatement of prior meaningful difference standards to simplify the consumer shopping experience and make it easier to compare the differences between coverage options,” AHIP suggested. 

AHIP also recommended that HHS focus on tweaking the consumer experience on HealthCare.gov to support enrollees’ decision-making processes.

ACAP acknowledged that there may be too many options on the exchanges, leading to a challenging process for consumers. The organization underscored that stronger meaningful difference standards could help reduce redundant offerings.

Network adequacy

ACAP supported the proposed rule’s recommendation to improve network adequacy and transparency. This is a shift from previous comments in which the organization opposed standardizing network adequacy rules, in favor of leaving that responsibility to the states. That is no longer possible since a court vacated a federal review of network adequacy.

However, the organization asked HHS to delay the network adequacy standard proposal until 2024. AHIP, likewise, requested a deferral and added that the implementation of appointment wait time standards should likewise be pushed back until the pandemic’s impact on healthcare workforce shortages has subsided.

Apart from sharing the groups’ stances on risk adjustment, standardization, and network adequacy, AHIP and ACAP also commented on the Notice of Benefit and Payment Parameters for 2023’s proposals around health equity data, essential health benefits, essential community providers, re-enrollment hierarchy, and medical loss ratios.

The comment period for this proposed rule closed on January 27, 2022.