Executive Director Report September 2016

Transcription

1 Executive Director Report September 2016 By Sharon Becker, Executive Director, September 8, 2016 Administration OIC Filing WSHIP s 2017 contracts and forms were SERFF (System for Electronic Rate and Form Filing) filed on August 26 for approval by the Office of Insurance Commissioner. PMPM Report to OIC The pmpm cost of WSHIP assessments for 2015 has been reported to Commissioner Kreidler as required by statute. It was $0.88 pmpm on an incurred basis, down from $1.22 in Attached is the report. PBM Audit Claims Technology Inc., (CTI) has begun an audit of WSHIP s pharmacy benefit manager, Express Scripts. This audit was included in WSHIP s 2016 Board Schedule and Work Plan, and is in accordance with WSHIP s usual practice to periodically audit contracted vendors. Glucose Monitoring Project Planning is underway with Medwatch and BMI to offer a glucose monitoring program to eligible non-medicare enrollees in The program, called Connected Diabetes Program uses a cellular-enabled blood glucose monitor that automatically triggers the transmission of data to the clinical team who is available 24/7/365 to help get glucose levels back in control. It also provides ongoing messaging after each test to educate and support the enrollee in managing their diabetes. A project implementation plan will be presented to WSHIP s Planning Committee in October. Board OIC Representative Jason Siems left the OIC at the end of May and took a new position as the State s Risk Manager. On June 13 th, Commissioner Kreidler appointed AnnaLisa Gellermann, Deputy Insurance Commissioner for Policy and Legislative Affairs, as WSHIP s new ex-officio board member representing the Insurance Commissioner. WSHIP Update Included in House of Representatives 2016 Interim Plan The Health Care & Wellness Committee is planning a work session on WSHIP in late November or early December. The committee is requesting an update from WSHIP on current enrollment and the need for continued pool coverage for certain populations. Attached is the committee s agenda and description of the WSHIP work session. Washington Health Benefit Exchange (HBE) 2017 QHP Certification and Open Enrollment The HBE Board has certified 46 individual Qualified Health Plans (QHPs) from 7 issuers for additional plans by 2 issuers are still pending OIC approval. If approved, this will bring the total to 98 plans by 9 issuers. 53% of 2017 plans are EPO (Exclusive Provider Organization) plans, compared to 34% in New for 2017 is the offering of family dental plans in the Exchange. Open enrollment begins November 1. Premera Premera will be withdrawing from 12 counties in the Exchange in 2017, and will no longer be offering individual coverage outside the Exchange. Aetna Aetna will stop selling coverage in 11 state exchanges next year, following similar decisions from Cigna, Humana, and UnitedHealth Group. Aetna has not offered any plans through our state exchange so its decision to exit exchanges in other states should not impact Washington state customers.

2 Health and Human Services (HHS) CMS is proposing new standards to strengthen the marketplaces. These are included in the 2018 Notice of Benefit and Payment Parameters that was issued on August 29, This includes steps to strengthen the risk adjustment program, improve the consumer experience, and strengthen the individual and small group markets as a whole. Attached is a fact sheet that accompanied the notice. Other Alaska Reinsurance Program Legislation was recently passed to help stabilize the Alaska individual market. The legislation establishes a state reinsurance program that will be administered by the state high risk pool (BMI is the administrator). $55 million of state premium tax revenue is being redirected to fund the reinsurance program. Premera will be the only insurer in Alaska s individual market for Page 2 of 2

3 INCURRED BASIS WSHIP PMPM Calculations Financial Information Year ended Year ended Year ended Year ended Year ended Year ended Year ended Year ended Year ended Year ended 12/31/ /31/ /31/ /31/ /31/ /31/ /31/ /31/ /31/ /31/2006 Source Revenue Earned premium $11,602,968 $13,806,921 $36,594,592 $31,629,551 $31,036,298 $29,398,559 $24,408,153 $19,604,248 $18,617,550 $18,250,241 Audited financials Excess loss ratio receipts $0 $0 $0 $0 $503,720 $479,733 $301,419 $52,808 $47,253 $717,409 Audited financials Federal grant awards $0 $1,110,440 $1,300,715 $1,346,790 $1,643,773 $1,630,823 $2,294,096 $1,617,258 $0 $2,432,464 Audited financials Investment income/other $2,150 $3,023 $94,733 $168,342 $2,130 $13,188 $136,003 $229,254 $456,626 $404,148 Audited financials Total revenue $11,605,118 $14,920,384 $37,990,040 $33,144,683 $33,185,921 $31,522,303 $27,139,671 $21,503,568 $19,121,429 $21,804,262 Expenses Medical claims incurred $29,991,598 $32,927,275 $57,946,081 $55,841,910 $47,468,065 $42,987,745 $36,354,148 $36,044,052 $32,094,414 $26,919,174 BMI data Medical IBNR 7/31/16 $70,840 $0 $0 $0 $0 $0 $0 $0 $0 $0 Leif Associates Pharmacy claims incurred $15,618,826 $19,853,062 $53,739,254 $44,364,978 $43,919,674 $37,237,056 $29,361,766 $24,009,726 $24,255,508 $22,808,932 BMI data Pharmacy IBNR 7/31/15 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Leif Associates Administrative costs $2,457,350 $2,748,616 $3,045,337 $3,018,110 $2,766,577 $2,938,775 $3,468,600 $3,567,380 $3,566,386 $2,388,435 Audited financials Total expenses $48,138,615 $55,528,953 $114,730,672 $103,224,998 $94,154,316 $83,163,576 $69,184,514 $63,621,158 $59,916,308 $52,116,541 Net Loss (1) ($36,533,497) ($40,608,569) ($76,740,632) ($70,080,315) ($60,968,395) ($51,641,273) ($42,044,843) ($42,117,590) ($40,794,879) ($30,312,279) Revenue - expenses Assessments (2) $33,999,828 $45,500,000 $84,543,448 $74,031,979 $64,053,527 $53,087,591 $44,558,900 $40,700,000 $37,868,709 $31,737,155 Audited financials Assessed members Health plan (3) 37,663,496 36,418,058 31,879,463 33,658,747 35,879,379 32,584,817 34,680,628 36,139,995 35,424,035 34,655,996 BMI survey Stop loss (4) 10,150,977 9,847,337 9,588,961 8,961,859 7,561,825 7,216,423 7,412,108 8,546,224 7,925,811 6,899,704 BMI survey Total (5) 47,814,473 46,265,395 41,468,424 42,620,606 43,441,204 39,801,240 42,092,736 44,686,219 43,349,846 41,555,700 PMPM Calculations - Stop 1/10 Formula Net Loss PMPM ($0.94) ($1.09) ($2.34) ($2.03) ($1.66) ($1.55) ($1.19) ($1.14) ($1.13) ($0.86) (1) / ( (3)+.10 x (4) ) Assessment PMPM $0.88 $1.22 $2.57 $2.14 $1.75 $1.59 $1.26 $1.10 $1.05 $0.90 (2) / ( (3)+.10 x (4) ) PAID BASIS Financial Information Year ended Year ended Year ended Year ended Year ended Year ended Year ended Year ended Year ended Year ended 12/31/ /31/ /31/ /31/ /31/ /31/ /31/ /31/ /31/ /31/2006 Source Revenue Premium $12,345,832 $13,735,113 $32,683,121 $31,801,243 $34,631,440 $29,786,390 $24,119,568 $20,028,510 $18,466,676 $17,636,623 Audited financials Excess loss ratio receipts $0 $0 $0 $0 $503,720 $479,733 $301,419 $52,808 $47,253 $717,409 Audited financials Federal grant awards $445,824 $594,222 $1,698,722 $1,152,300 $1,936,976 $1,580,315 $2,180,598 $1,213,297 $2,432,464 $0 Audited financials Investment income/other $2,150 $3,023 $340,235 $18,342 $2,130 $13,188 $136,006 $229,254 $456,626 $404,148 Audited financials Total revenue $12,793,806 $14,332,358 $34,722,078 $32,971,885 $37,074,266 $31,859,626 $26,737,591 $21,523,869 $21,403,019 $18,758,180 Expenses Medical/Rx claims paid $46,296,066 $57,561,181 $111,850,514 $100,256,291 $92,003,313 $76,827,709 $65,982,326 $56,893,934 $53,431,816 $47,813,891 Audited financials Administrative costs $1,836,285 $2,314,866 $3,042,454 $2,984,722 $2,813,552 $2,950,549 $3,561,519 $3,750,186 $3,193,723 $2,356,765 Audited financials Total expenses $48,132,351 $59,876,047 $114,892,968 $103,241,013 $94,816,865 $79,778,258 $69,543,845 $60,644,120 $56,625,539 $50,170,656 Net Loss (1) ($35,338,545) ($45,543,689) ($80,170,890) ($70,269,128) ($57,742,599) ($47,918,632) ($42,806,254) ($39,120,251) ($35,222,520) ($31,412,476) Revenue - expenses Assessments (2) $28,858,333 $53,930,290 $85,521,061 $74,499,537 $61,163,450 $51,438,028 $45,737,695 $41,409,297 $37,898,623 $28,751,178 Audited financials (less exc lr rcpts) Assessed members Health plan (3) 37,663,496 36,418,058 31,879,463 33,658,747 35,879,379 32,584,817 34,680,628 36,139,995 35,424,035 34,655,996 BMI survey Stop loss (4) 10,150,977 9,847,337 9,588,961 8,961,859 7,561,825 7,216,423 7,412,108 8,546,224 7,925,811 6,899,704 BMI survey Total (5) 47,814,473 46,265,395 41,468,424 42,620,606 43,441,204 39,801,240 42,092,736 44,686,219 43,349,846 41,555,700 PMPM Calculations - Stop 1/10 Formula Net Loss PMPM ($0.91) ($1.22) ($2.44) ($2.03) ($1.58) ($1.44) ($1.21) ($1.06) ($0.97) ($0.89) (1) / ( (3)+.10 x (4) ) Assessment PMPM $0.75 $1.44 $2.60 $2.16 $1.67 $1.54 $1.29 $1.12 $1.05 $0.81 (2) / ( (3)+.10 x (4) ) 9/8/2016 Leif Associates

4 HEALTH CARE & WELLNESS COMMITTEE SCHEDULE DATE LOCATION TYPE SUBJECTS COMMITTEE Committee Assembly Olympia Work Session Health Impacts of Marijuana Legislation Access to Dental Care for Medicaid Enrollees Full Committee Washington State Health Insurance Pool Administrative Simplification September/ October Seattle Work Session Seattle Center Volunteer Clinic Institute for Health Metrics and Evaluation Full Committee University of Washington Health Sciences Interdepartmental Collaboration School Nutrition and Physical Education Requirements TBD* Tour of State Hospitals with Select Committee on Quality Improvement in State Hospitals Full Committee; Joint with SCQUISH and JUDI RELATED INTERIM COMMITTEES DATE LOCATION TYPE SUBJECTS COMMITTEE TBD* Joint Legislative Executive Committee on Aging and Disability TBD* Joint Select Commi ee on Health Care Oversight *To be determined by the interim committee. To view specific meeting dates and times, please visit: To sign up for notifications, including updates to meeting dates and times, please visit: Health Care & Wellness Page 48

5 HEALTH CARE & WELLNESS COMMITTEE WORKPLAN Health Impacts of Marijuana Legislation GOAL: Obtain an understanding of any effects of marijuana regulations on public health, including rates of substance use and abuse among youth and adults. DESCRIPTION: Initiative 502 (2012) established a regulatory system for the sale of marijuana in Washington. Legislation in 2015 incorporated medical marijuana distribution into the regulatory structure established under the Initiative. The Initiative called for the Washington State Institute for Public Policy (WSIPP) to provide several reports on the effects of the marijuana regulations, including its effects on public health. A preliminary report was issued by WSIPP in September 2015 and several final reports are due beginning in September The Committee will receive an update from WSIPP on its preliminary findings related to marijuana and public health. Access to Dental Care for Medicaid Enrollees GOAL: Monitor the recommendations of the dental services work group at the Health Care Authority. DESCRIPTION: Substitute House Bill 2498 (2016) directed the Health Care Authority to establish a work group to make improvements to the prior authorization system for dental providers in medical assistance programs. The recommendations are to address wait times for prior authorization approvals, dental services that do not need prior authorization, ways to reduce burdens on dental providers, and adjustments in payment practices. The Committee will receive an update from the Health Care Authority on the work group's findings and recommendations. Health Care & Wellness Page 49

6 Washington State Health Insurance Pool GOAL: Receive an update from the Washington State Health Insurance Pool and evaluate whether continued pool coverage is necessary for certain populations. DESCRIPTION: The Washington State Health Insurance Pool (WSHIP) provides health insurance coverage for individuals who are unable to obtain comprehensive health insurance or Medicare supplemental coverage on the open market. The WSHIP is funded through a combination of premiums, assessments on health insurers, and federal grants. The WSHIP will discontinue all comprehensive health insurance coverage on December 31, 2017, but will continue to offer Medicare supplemental coverage. In 2012 and 2015, the WSHIP submitted reports to the Legislature on the need for continuing WSHIP coverage for certain populations. The most recent report recommended that (1) the WSHIP continue offering both Medicare supplemental and comprehensive health insurance coverage beyond December 31, 2017, (2) the WSHIP funding formula be maintained, and (3) coverage for undocumented immigrants be expanded through the Alien Medical for Dialysis and Cancer Treatment Program to cover other serious medical conditions. The Committee will receive an update from the WSHIP on current enrollment and the need for continued pool coverage for certain populations. STAFF: Jim Morishima and Alexa Silver Administrative Simplification GOAL: Receive an update from the Office of the Insurance Commissioner on its administrative simplification efforts. DESCRIPTION: In 2009, the Office of the Insurance Commissioner (OIC) was directed to designate a lead entity to develop processes, guidelines, and standards to streamline health care administration. The OIC and its lead entity, OneHealthPort, facilitated a work group to develop best practice recommendations on prior authorization. In 2016, the OIC plans to develop rules to provide transparency and predictability regarding the prior authorization process. The Committee will receive an update on these rules. STAFF: Alexa Silver and Jim Morishima Health Care & Wellness Page 50

7 Seattle Center Volunteer Clinic GOAL: Receive information about the Seattle Center Volunteer Clinic and learn about ways to extend the model to other communities. DESCRIPTION: In 2013 the Legislature passed EHB 2351 which allowed health care professionals from other states to practice in Washington on a limited volunteer basis under certain conditions. To use the licensing exception, the volunteer health care professional must be affiliated with a sponsoring organization. In 2014 and 2015, the Seattle Center sponsored a free health care clinic which used volunteer health care providers from outofstate and reported on the results to the Health Care and Wellness Committee. The Committee will receive a report on the Seattle Center Volunteer Clinic activity in 2015 and its plans for the future. Institute for Health Metrics and Evaluation GOAL: Receive information on the University of Washington's Institute for Health Metrics and Evaluation. DESCRIPTION: The Institute for Health Metrics and Evaluation (IHME) at the University of Washington collects worldwide population health data for research and policy analysis. The IHME makes its data available free of charge to anyone who requests it. The Committee will receive information on the IHME's work and the types of data available to policymakers. STAFF: Alexa Silver and Jim Morishima Health Care & Wellness Page 51

8 University of Washington Health Sciences Interdepartmental Collaboration GOAL: Obtain a better understanding of how the life science department deans at the University of Washington collaborate. DESCRIPTION: The University of Washington has several life science departments, including dentistry, medicine, nursing, pharmacy, public health, social work, and health sciences administration. The University has been working to establish an integrated, collaborative learning system to connect disciplines, promote teamwork, foster mutual understanding, strengthen research, and advance health. The Committee will receive an overview of the University's work on interprofessional education and care. School Nutrition and Physical Education Requirements GOAL: Review efforts to help children achieve healthy active lifestyles and maintain a healthy weight. DESCRIPTION: The Healthiest Next Generation Initiative, through the coordination of the Department of Health, has been working to establish policy options to help Washington's children achieve healthy active lifestyles and maintain a healthy weight. The Committee will explore how to support these health goals for children while they are at school. The Committee will review recommendations for physical activity and nutrition and the extent to which Washington's schools are helping children meet these recommendations. Health Care & Wellness Page 52

9 Tour of State Hospitals with Select Committee on Quality Improvement in State Hospitals GOAL: Understand the issues facing patients and staff at the state hospitals. DESCRIPTION: ESSB 6656 establishes the Select Committee on Quality Improvement in State Hospitals to monitor, receive updates from, and make recommendations related to the role of state hospitals in the mental health system, the use of the Behavioral Health Innovation Fund, the monitoring of outcome measures, and reviews of survey results. The capacity of the state hospitals is an indication of the condition of the broader community mental health system. The Committee shall participate in tours of state hospitals organized through the Select Committee. NUMBER & TYPE OF MEETINGS: One or two tours Health Care & Wellness Page 53

10 Foundational Public Health HEALTH CARE & WELLNESS STAFF RESEARCH PROJECTS GOAL: Monitor the development of a statewide proposal to modernize and fund foundational public health services. DESCRIPTION: The 2016 Supplemental Operating Budget directs the Department of Health and local health jurisdictions to develop a proposal for statewide implementation of foundational public health services. The proposal must outline a plan for modernizing, streamlining, and funding a twentyfirst century public health system. The first report is due to the Legislature by December 1, Staff will monitor the work of the Department and local health jurisdictions as they develop the report. Balance Billing GOAL: Address the issue of balance billing for medical services. DESCRIPTION: Balance billing occurs when a health care provider bills a patient for amounts not covered by insurance. Balance billing most often occurs when a patient receives services from a provider who does not contract with the patient's insurer. In this project, staff will work with stakeholders to discuss legislative options to address balance billing for medical services rendered by outofnetwork providers. STAFF: Jim Morishima and Alexa Silver Health Care & Wellness Page 54

11 HEALTH CARE & WELLNESS RELATED INTERIM COMMITTEES Joint Legislative Executive Committee on Aging and Disability GOAL: Review issues affecting aging and disabled populations to promote quality services and appropriate supports to these populations. DESCRIPTION: The Joint Legislative Executive Committee on Aging and Disability was convened during the 2013 and 2014 interims to develop a strategy for addressing several issues related to preparing for the aging of Washington's population. The Operating Budget continues the Committee through the 2016 interim with two additional members and several new topics. In the 2016 interim, the Committee plans to follow up on the items that it discussed last year relating to improving the care of residents in institutional settings and guardianships. In addition, the Committee will consider other issues including the health care needs of older adults, support for best practices in end of life care, financial security in retirement, and building communities that support older adults. The Committee will issue final recommendations by December 10, NUMBER & TYPE OF MEETINGS: Three work sessions Joint Select Committee on Health Care Oversight GOAL: Oversee and monitor executive agencies and the Health Benefit Exchange as they implement the state's health care policy. DESCRIPTION: Several agencies and entities have a role in implementing health care policy in Washington, including the Office of the Insurance Commissioner, the Department of Health, the Department of Social and Health Services, the Health Care Authority, and the Health Benefit Exchange. The Joint Select Committee on Health Care Oversight will provide oversight between these agencies and organizations. This oversight will include monitoring of each entity's activities to ensure they are not duplicating their efforts and are working towards a goal of increased quality of service. NUMBER & TYPE OF MEETINGS: Two work sessions STAFF: Alexa Silver and Jim Morishima Health Care & Wellness Page 55

12 Proposed HHS Notice of Benefit and Payment Parameters for 2018 Fact Sheet The proposed HHS Notice of Benefit and Payment Parameters for 2018 released today proposes standards for issuers and each Health Insurance Marketplace SM1, generally for plan years that begin on or after January 1, The Marketplace continues to play an important role in fulfilling one of the Affordable Care Act s core goals: reducing the number of uninsured Americans by providing access to affordable, quality health insurance. As of the end of March 2016, about 11.1 million people had health insurance coverage through a Marketplace, almost a million more than at that point in time the previous year. The proposals in this proposed rule include improvements to the risk adjustment program that will strengthen its ability to protect consumers access to high-quality, affordable options in the individual and small group markets, as well as other changes that will streamline the Marketplace consumer experience and the individual and small group markets as a whole. The actions in this proposed rule build on other actions CMS has taken to strengthen the Marketplace in recent months, including a recent request for information (RFI) seeking public comment on concerns that some health care providers and provider-affiliated organizations may be steering Medicare or Medicaid enrolled or eligible people into a Marketplace qualified health plan (QHP) to obtain higher reimbursement rates 2 ; the announcement of a new outreach strategy targeting young adults 3 ; and beginning implementation of the special enrollment confirmation process to ensure eligible individuals have access to coverage while preventing misuse of the system 4. This fact sheet highlights certain elements of the proposed rule. In addition to the elements described below, we also seek comment on other ideas to improve the risk pool, such as clarified coordination of benefits rules, grace period policy, specifying a certain amount or percent of user fee revenue for education and outreach, and whether and how to further support the transition of former Pre-Existing Condition Insurance Plan (PCIP) Program enrollees into the Marketplace to ensure that they do not experience a lapse in coverage. Risk Adjustment Model Recalibration Accounting for Partial Year Enrollment: We are proposing to incorporate partial year adjustment factors in the adult risk adjustment model to address feedback that the existing model underpredicts claims costs for enrollees who are enrolled for only part of the year. We are proposing to incorporate the partial year adjustment factors in the adult 2017 and 2018 benefit year risk adjustment models, as we previously indicated in guidance. 5 1 Health Insurance Marketplace SM and Marketplace SM are service marks of the U.S. Department of Health & Human Services. 2 Available at: For the press release regarding the RFI, see 3 Available at: 4 For a description of the process, see, 5 Available at: 1

13 Proposed HHS Notice of Benefit and Payment Parameters for 2018 Fact Sheet Incorporating Prescription Drug Utilization: We propose to use prescription drug utilization data to improve the predictive ability of our risk adjustment models beginning for the 2018 benefit year. By using prescription drugs to impute missing diagnoses and to indicate the level of severity of a health condition, we will better account for the health risk associated with insuring individuals with certain serious health conditions. High-Cost Risk Pool: We propose to modify the treatment of high-cost enrollees in the model to improve the model's ability to better predict risk for issuers who enroll sicker-than-average enrollees, better protecting access to high-quality, affordable coverage and improving protection for issuers with enrollees that have unpredictably high costs. Specifically, we propose to create a pool of high-cost enrollees where an adjustment to issuers transfers would fund 60 percent of costs where individual costs are above $2 million. Publication of Final Coefficients: We propose to issue final 2018 benefit year coefficients prior to the 2018 benefit year risk adjustment calculations using the most recently available MarketScan data, likely in the early spring of We would continue to finalize the underlying risk adjustment methodology used to arrive at the final coefficients in the final Payment Notice. Publishing the final coefficients closer to the calculation of risk adjustment for the 2018 benefit year would provide for risk adjustment coefficients that reflect the most current data available for the applicable benefit year. Future Recalibration: We propose to use data from external data gathering environment (EDGE) servers, the systems issuers use to submit data for the risk adjustment and reinsurance programs, to recalibrate the risk adjustment models beginning for the 2019 benefit year, which would improve model accuracy. We would use a masked enrollee-level dataset from the EDGE server to recalibrate the risk adjustment models and inform development of the Actuarial Value Calculator and risk adjustment methodology, which HHS releases annually. The dataset would use masked enrollee IDs, and would not include the identity of the geographic rating area, state, plan, issuer, or the EDGE server. We believe this dataset would also be a valuable tool for deepening understanding of the evolving Marketplace and driving innovation. Risk Adjustment Data Validation: We also propose several amendments to the risk adjustment data validation process, including proposals related to the review of prescription drug data, random sampling for issuers below a certain size, and the establishment of a discrepancy and administrative appeals process. Payment Parameters FFM User Fee for 2018: We propose to charge a Federally-facilitated Marketplaces (FFM) user fee rate of 3.5% of premium for the 2018 benefit year. This user fee rate is the same as the rate for each year from 2014 through 2017 benefit years. We propose to charge issuers operating in a State-based Marketplace on the Federal platform (SBM-FP) a user fee rate of 3% of premium for the 2018 benefit year. We also seek comment on how much user fee funding to devote to outreach and education to help ensure robust enrollment in the Marketplace. Premium Adjustment Percentage: This percentage generally measures the average health insurance premium increase since 2013, based on the most recent National Health Expenditures Accounts 2

14 Proposed HHS Notice of Benefit and Payment Parameters for 2018 Fact Sheet projection of per enrollee employer-sponsored insurance premiums. The premium adjustment percentage is used to set the rate of increase for three key parameters: the maximum annual limitation on cost sharing, the required contribution percentage for eligibility for a certain exemptions under section 5000A of the Code, and the affordability percentage for calculation of assessable payment amounts under section 4980H(a) and (b) of the Code. For 2018, we are proposing a premium adjustment percentage of approximately 16.17%, reflecting an increase of 2.6% from Annual Limitation on Cost Sharing: The maximum annual limitation on cost sharing is the product of the dollar limit for calendar year 2014 ($6,350 for self-only coverage) and the premium adjustment percentage for 2018, rounded down to the next lower $50. We are proposing a maximum annual limitation on cost sharing for 2018 of $7,350 for individual coverage and $14,700 for family coverage. Stand-alone dental plans (SADPs) related to the annual limitation on cost sharing: Under our rules, the annual limitation on cost sharing is established for plan years through 2018, and then indexed to the consumer price index (CPI) for dental services thereafter. Therefore, this rule proposes maintaining the dental annual limitation on cost sharing at $350 for one child and $700 for one or more children. Plan Benefits Bronze Plans: To permit greater flexibility in benefit design and to accommodate potential future updates to the Actuarial Value Calculator, we propose to permit a broader de minimis range for the actuarial value of bronze plans when the plan covers services before application of the deductible. Standardized Options (Simple Choice plans): In the 2017 Payment Notice, we finalized six standardized options (also now referred to as Simple Choice plans) for 2017, one at each of the bronze, silver, silver cost-sharing reduction variation, and gold levels of coverage based on analysis of 2015 enrollmentweighted FFM qualified health plan (QHP) data. For 2018, we propose updated standardized options, based on a similar analysis of enrollment-weighted 2016 individual market FFM QHP and also SBM-FP QHP data. Additionally, recognizing that issuers in some states were unable to offer standardized options due to the requirements of certain state laws on cost sharing, we propose a larger number of standardized options, with the intent that at least one standardized option in each level of coverage will comply with State requirements. Each State would still only have one standardized option at each level of coverage. We also propose a standardized health savings account-eligible bronze high-deductible health plan option that would comply with IRS Health Savings Account rules. Network Breadth: In the 2017 Payment Notice, HHS finalized a policy to provide information about QHP network breadth on HealthCare.gov, in order to assist consumers with plan selection. For the 2017 benefit year, we intend to pilot a network breadth indicator in a number of States on HealthCare.gov to denote a QHP s relative network coverage. For the 2018 plan year, we are proposing to incorporate more specificity into these indicators by identifying for consumers whether a particular plan is offered as part of an integrated provider delivery system. We also seek comment on whether there are additional steps we can take to limit surprise bills for consumers building on the requirements set forth in the Notice of Benefit and Payment Parameters for Eligibility, Enrollment, and Benefits 3

15 Proposed HHS Notice of Benefit and Payment Parameters for 2018 Fact Sheet Special Enrollment Periods: We propose to codify several special enrollment periods that are already available to consumers in order to ensure the rules are clear and to limit abuse. We also seek comment on policy or outreach steps we could take related to special enrollment periods that would help strengthen Marketplace risk pools by helping more eligible individuals enroll and preventing abuse by ineligible individuals. Direct Enrollment: We propose a number of consumer protections around the direct enrollment channel, though which web-brokers and issuers may enroll consumers directly. For instance, we propose that these direct enrollment entities must demonstrate operational readiness and compliance with certain requirements prior to their Web sites being used to complete QHP selection, and provide differential display of standardized options. We propose that web-brokers must display certain information relating to advance payments of the premium tax credits prominently, and permit enrollees to select a particular APTC level, requirements that already apply to QHP issuers engaged in direct enrollment. We also propose that web-brokers engage in certain post-enrollment assistance activities. In addition, we propose to allow third parties to perform monitoring and oversight over web-brokers, to ensure compliance with our direct enrollment requirements. Binder Payments: We propose to give Marketplaces the discretion to allow issuers to implement a reasonable extension of the binder payment deadlines when an issuer is experiencing billing or enrollment problems due to high volume or technical errors. Market Reforms Child Age Rating: We propose updates to the child age rating structure to better reflect the health risk of children and to provide a more gradual transition when individuals move from age 20 to 21. Specifically, we propose one age band for individuals age 0 through 14, and then single-year age bands for individuals age 15 through 20, effective for plan years or policy years beginning on or after January 1, We also propose child rating factors that, overall, are higher than the current child factor and more accurately reflect health care costs for children. Reassessment of the 5-Year Ban on Market Reentry upon Withdrawal from a Market: We propose several changes to our guaranteed renewability regulations that would address instances where issuers may inadvertently trigger a market withdrawal and 5-year ban on market reentry. In these select instances, we believe is it appropriate to allow issuers to remain in the applicable market, and believe allowing so will improve the choice of plans available to consumers. We propose that, for purposes of guaranteed renewability, a non-grandfathered product may be considered the same product when offered by a different issuer within an issuer s controlled group, provided it otherwise meets the standards for uniform modification of coverage. We also propose that an issuer may replace all of its existing products with new products without triggering a market withdrawal, as long as the issuer matches new products with existing products for purposes of rate review. MLR Rebate Impact on New and Growing Issuers: We propose to expand the medical loss ratio (MLR) provision allowing issuers to defer reporting of policies newly issued with a full 12 months of experience (rather than policies newly issued and with less than 12 months of experience) in that MLR reporting year, and to limit the total rebate liability payable with respect to a given calendar year in certain situations. 4