Patient Protection and Affordable Care Act; Annual Eligibility Redeterminations for Exchange Participation and Insurance Affordability Programs;…

I. Background

A. Legislative Overview

The Patient Protection and Affordable Care Act (Pub. L. 111-148) was enacted on March 23, 2010. The Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152), which amended and revised several provisions of the Patient Protection and Affordable Care Act, was enacted on March 30, 2010. In this final rule, we refer to the two statutes collectively as the "Affordable Care Act." Subtitles A and C of Title I of the Affordable Care Act reorganized, amended, and added to the provisions of part A of Title XXVII of the Public Health Service Act (PHS Act) relating to group health plans and health insurance issuers in the group and individual markets.

Starting on October 1, 2013 for coverage starting as soon as January 1, 2014, qualified individuals and qualified employers have been able to purchase qualified health plans (QHPs)--private health insurance that has been certified as meeting certain standards--through competitive marketplaces called Exchanges or Health Insurance Marketplaces. The word "Exchanges" refers to both State Exchanges, also called State-based Exchanges, and Federally-facilitated Exchanges (FFEs). In this final rule, we use the terms "State Exchange" or "FFE" when we are referring to a particular type of Exchange. When we refer to "FFEs," we are also referring to State Partnership Exchanges, which are a form of FFE.

Section 1411(f)(1)(B) of the Affordable Care Act directs the Secretary of Health and Human Services (the Secretary) to establish procedures to redetermine the eligibility of individuals on a periodic basis in appropriate circumstances. Section 1321(a) of the Affordable Care Act provides authority for the Secretary to establish standards and regulations to implement the statutory requirements related to Exchanges, QHPs and other components of Title I of the Affordable Care Act. Section 2703 of the PHS Act, as added by the Affordable Care Act, and sections 2712 and 2741 of the PHS Act, as added by the Health Insurance Portability and Accountability Act of 1996, require health insurance issuers in the group and individual markets to guarantee the renewability of coverage unless an exception applies.

B. Stakeholder Consultation and Input

The Department of Health and Human Services (HHS) has consulted with stakeholders on a number of policies related to the operation of Exchanges, including eligibility redetermination. HHS has held a number of listening sessions with consumers, providers, employers, health plans, and State representatives to gather public input. HHS consulted with stakeholders through regular meetings with the National Association of Insurance Commissioners (NAIC), regular contact with states through the Exchange grant process, meetings with the CMS Tribal Technical Advisory Group and an All Tribes Call on July 21, 2014 with tribal leaders and representatives, health insurance issuers, trade groups, consumer advocates, employers, and other interested parties. We considered all of the public input as we developed the policies in this final rule.

C. Structure of the Final Rule

The regulations in this final rule will be codified in 45 CFR parts 146, 147, 148, 155, and 156. Part 146 specifies standards related to the group health insurance market, including guaranteed renewability of coverage for employers in the group market. Part 147 specifies standards related to health insurance reforms for the group and individual health insurance markets, including guaranteed renewability of coverage. Part 148 specifies standards for the individual health insurance market, including guaranteed renewability of individual health insurance coverage. Part 155 specifies standards related to the establishment, operation, and minimum functionality of Exchanges, including annual eligibility redeterminations. Part 156 specifies standards for health insurance issuers with respect to participation in an Exchange.

II. Provisions of the Proposed Regulations and Analysis and Responses to Comments

On July 1, 2014, we published a proposed rule in the Federal Register (79 FR 37262) entitled, Patient Protection and Affordable Care Act; Annual Eligibility Redeterminations for Exchange Participation and Insurance Affordability Programs; Health Insurance Issuer Standards Under the Affordable Care Act, Including Standards Related to Exchanges. The July 1, 2014 proposed rule (hereinafter referred to as the July 1, 2014 Annual Eligibility Redeterminations proposed rule) proposed additional options for annual eligibility redeterminations and renewal and re-enrollment notice requirements for QHPs offered through the Exchange, beginning with annual redeterminations for the 2015 benefit year. In total, we received 36 comments on the July 1, 2014 Annual Eligibility Redeterminations proposed rule. Comments represented a wide variety of stakeholders, including but not limited to states, tribal organizations, health plans, healthcare providers, consumer groups, and industry experts. We note that we received some public comments that were outside the scope of the proposed rule and are not addressed in this final rule. We have not provided explicit responses to such comments.

In this final rule, we provide a summary of each proposed provision, a summary of and responses to public comments received, and the provisions we are finalizing.

A. Part 146--Requirements for the Group Health Insurance Market; Subpart E--Provisions Applicable to Only Health Insurance Issuers

For a discussion of the provisions of this final rule related to Part 146, see section II.B of this preamble.

B. Part 147--Health Insurance Reform Requirements for the Group and Individual Health Insurance Markets

In the preamble to the July 1, 2014 Annual Eligibility Redeterminations proposed rule, we proposed establishing a notice requirement that would apply to all issuers subject to the guaranteed renewability requirements that nonrenew coverage based on continued coverage not being available in the enrollee's service area as a result of changes that do not result in product discontinuances. This proposal was intended to ensure that enrollees receive notice when the product (as defined in 45 CFR 144.103) that they purchased no longer covers their location in its service area and their coverage will be nonrenewed consistent with the guaranteed renewability provisions. We sought comment on this proposal, including the appropriate timeframe for providing the notice. We received no comments on this proposal.

In this final rule, we amend the guaranteed renewability regulations at SEC 146.152(b)(5), SEC 147.106(b)(5), and SEC 148.122(c)(4) to direct an issuer that nonrenews coverage based on enrollees' movement outside the service area to provide notice in writing to each plan sponsor or individual, as applicable, (and to all participants and beneficiaries covered under the coverage) affected by such nonrenewal. This notice must be provided in the form and manner specified by the Secretary for notices of product discontinuances. This requirement applies to grandfathered and non-grandfathered coverage in the individual, small group, and large group markets offered through or outside an Exchange.

Final Rule Action: We are amending the guaranteed renewability regulations at SEC 146.152, SEC 147.106, and SEC 148.122 to establish a notice requirement for issuers that nonrenew coverage based on an enrollee no longer being located within the product's service area.

--This is a summary of a Federal Register article originally published on the page number listed below--

Final rule.

CFR Part: "45 CFR Parts 146, 147, 148, 155, and 156"

RIN Number: "RIN 0938-AS32"

Citation: "79 FR 52994"

Document Number: "CMS-9941-F"

Federal Register Page Number: "52994"

"Rules and Regulations"