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February 19, 2019

7.3 million people could see higher premiums, warns NPAF

Washington, DC — The newest proposal from the Center for Medicare and Medicaid Services (CMS) would raise premiums for over 7.3 million people and cause over 100,000 people to lose coverage, according to a comment letter submitted to CMS by the National Patient Advocate Foundation (NPAF).


The proposal would change the premium adjustment formula for qualified health plans (QHPs) sold on the Marketplace. While CMS currently calculates the premium adjustment factor based on employer-sponsored insurance premiums, CMS would now use private health insurance premiums in the formula- raising the premium adjustment factor by 3.6 percent by 2019. CMS itself anticipates that premiums would rise by up to $220 for over 7.3 million people.


The proposed rule would also increase limits on out-of-pocket costs for millions of people, including those with employer-based coverage. If the rule is finalized, the maximum out-of-pocket limit would be 2.5% higher, meaning that the family limit in 2020 would increase to $16,400 from $16,000.


By its own analysis, CMS admits that most of the federal cost-savings accomplished by this rule would come from dropping people from coverage.


“Once again, CMS has attempted to realize systemic savings by denying benefits and coverage to people rather than enacting thoughtful changes to the health system administration and bureaucracy that drive costs,” said Rebecca Kirch, NPAF Executive Vice President of Health Care Quality and Value.


In the letter, NPAF underscored its person-centered approach to plan design, enumerated below:


  1. Understandable and transparent information about coverage, accessibility, beneficiary responsibility and cost should be publicly available to support consideration of treatment benefits and tradeoffs.
  2. Regulatory agencies and health plans should be accountable for ensuring benefit design and utilization management practices are clear, understandable, flexible and evidence-based, including transparent processes that inform patients and practitioners about plan updates that result in changes to prescribed treatments.
  3. Key provisions that safeguard patients from discriminatory practices and disparate outcomes should be preserved and expanded among all health insurance plans including those that significantly increase premiums and out-of-pocket (OOP) costs.
  4. Policy solutions that directly lower patients’ OOP costs should be prioritized and those that affect other stakeholders should not inadvertently raise the amount that patients are expected to pay through deductibles, cost-sharing or premiums.


The original comment letter is available here.