Insurers caution on ending auto-enrollment for low-income individuals
HEALTH INSURERS and their trade associations, providers, employer groups and unions are sounding an alarm over the federal government’s recent suggestion that it may stop automatically re-enrolling certain low-income people in Affordable Care Act exchange plans.
The CMS in January asked for feedback on whether it should eliminate or reduce tax credits for subsidized exchange enrollees who pay no premiums for their plans unless they actively re-enroll in coverage during open enrollment. The agency said the change could reduce the risk that it pays out premium tax credits to ineligible people.
The agency pitched the idea in the 2021 proposed rule that outlines standards governing ACA-compliant plans. In comment letters on the proposed rule, health insurers and providers said such a change would cause widespread confusion and result in more uninsured people.
“The policy discussed by CMS would sow significant confusion and lead to loss of coverage unless consumers take counterintuitive steps. This proposal has a disproportionate impact on low-income consumers. What’s most disquieting is that that seems to be the point,” said Margaret Murray, CEO of the Association for Community Affiliated Plans, which represents 74 not-for-profit and community-based safety-net health plans.
At least 1.8 million people were automatically re-enrolled in exchange coverage in 2019, including 270,000 who paid no premiums, according to HHS.
California-based integrated system and insurer Kaiser Permanente explained that such “discriminatory treatment” against low-income customers would require health insurers to invest more in outreach, education and member support to minimize confusion and resolve delinquencies for people who wouldn’t be expecting a bill.
UPMC Health Plan commented that a better way to encourage people to take a proactive role in selecting coverage would be to restore “significantly reduced marketing and outreach funding that previously supported navigators and other community assistance resources.” The Trump administration slashed the budget for outreach by 90% in 2018.
The Federation of American Hospitals questioned the CMS’ authority to end automatic re-enrollment for certain people, arguing that “the ACA does not permit the exchanges to consider information unrelated to (advance premium tax credit) eligibility” when determining if someone qualifies.
While most comment
At least 1.8 million people were automatically re-enrolled in exchange coverage in 2019, including 270,000 who paid no premiums, according to HHS.
ers slammed the proposal to end automatic re-enrollment, other changes included in the proposed rule received mixed reactions. Health insurers and employer groups supported the CMS’ idea to allow insurers to stop drug manufacturer coupons from going toward a patient’s annual limit on out-of-pocket costs even when a generic drug isn’t available.
The Business Group on Health claimed that employers need to be able to deploy so-called copay accumulator programs to encourage the use of lower-cost drugs.
On the flip side, the Service Employees International Union, which represents 2 million workers, said people would be subjected to unaffordable prescription drug prices without drug manufacturer coupons to help defray the costs.
The proposed rule also offered examples of how health insurers could introduce value-based insurance design to their exchange plans but said value-based plans wouldn’t be preferentially displayed on HealthCare.gov. Some groups urged the CMS to rethink its stance against encouraging enrollment in value-based plans.
The Alliance of Community Health Plans, for example, asked the CMS to create new policies to educate consumers about value-based insurance plans and provide preferential display for plans meeting a minimum set of value-based insurance design principles.
“Without such attention to the value-based insurance plan designs, consumers will likely be unable to properly evaluate these plans over traditional metallic plans and determine their individual value,” the ACHP wrote.
However, America’s Health Insurance Plans, one of the industry’s largest lobbying groups, said designating certain plans as “value-based” could hinder plans that don’t conform to certification standards and introduce operational challenges to the exchanges.●