Proposed rule could expand state roles in ACA

CMS released a proposed rule October 27 that could add flexibility for states with regard to provisions of the Affordable Care Act (ACA).

The agency says it is looking to ease the burden associated with states applying for and being granted an adjustment to their state’s individual market medical loss ratio (MLR). This is proposed as a way to help states stabilize their markets. CMS is seeking comments on whether to include federal and state taxes in the MLR rebate calculation.

The proposed rule also addresses risk adjustment, proposing that HHS change the parameters to stabilize individual and group markets. The rule also proposes changes to risk adjustment data validation to help alleviate issuer burden and ensure the integrity of risk adjustment results.

CMS is proposing its annual update to small group and individual markets. The proposed user fee rates for 2019 are 3.5% of premiums for federally facilitated exchanges and 3% of premiums for state-based exchanges.

The rule proposes adding flexibility to the definition of essential health benefits (EHB) by allowing states to adapt EHBs to promote health insurance affordability. CMS also proposes finding new ways to support state-based exchanges in their effort to operationally enhance their exchange sites. The rule also proposes making the federal exchange platform more appealing to states. 

The proposed rule recommends that states play a greater role in certifying qualified health plans (QHP), which would allow states to oversee their health insurance markets and reduce the burden associated with complying with state and federal reviews of QHPs.

CMS also proposed changes to the Small Business Health Options Program (SHOP) that would permit employers and employees to work with a QHP issuer or SHOP agent to enroll in a plan.

Comments on the proposed rule are due November 27.