Qualified Health Plans

Exchange Certified

Exchanges can only offer qualified health plans, and no other types of coverage. A qualified health plan is an “exchange certified” plan that offers an “essential health benefits package” offered by an insurer that:

  • is licensed and in good standing with the state in which they offer coverage;
  • agrees to offer at least one qualified health plan at the Silver level and Gold level of coverage in the exchange;
  • agrees to charge the same premium rate for each qualified health plan, whether it is offered inside the exchange or in the private insurance marketplace through an insurer or agent; and
  • complies with regulations issued by the Department of Health and Human Services and the exchange.

Transparency in Coverage Regulations

Qualified health plans must be “certified” by the exchange, which means that they must comply with a certification process. Part of the certification process is the transparency in coverage reporting requirements. The transparency in coverage regulations require that a plan or insurer that wishes to offer coverage through an exchange, as a qualified health plan, to submit reports on the plan or coverage. These reports, sent to the exchange and HHS, will include the following information:

  • claims payment policies
  • periodic financial disclosures
  • data on enrollment and disenrollment
  • data on the number of claims denied
  • data on rating practices
  • information on cost sharing and payments regarding any out-of-network coverage
  • information on enrollee and participant rights under the Affordable Care Act
  • other information as determined appropriate by the Secretary of HHS.

The transparency in coverage requirements is just one piece of the certification process. The Department of Health and Human Services is required to establish certification procedures and regulations beyond the reporting requirement just discussed. HHS will establish regulations that require plans to:

  • meet marketing requirements
  • ensure sufficient provider choice and include, where available, providers that serve low- income and medically underserved individuals
  • be accredited for clinical quality, patient experience, consumer access, quality assurance, and has implemented a quality improvement strategy
  • use a uniform enrollment form and a standard format for presenting plan options
  • provide information on quality standards used to measure plan performance

After the exchange and HHS receive this information and certify the plan, then the plan’s information will be posted on a web portal for consumers to have access. This will present a new level of transparency unprecedented in the healthcare industry.

Essential Health Benefits Package

Essential health benefits are a key piece of healthcare reform. Even before exchanges are required starting in 2014, regulations regarding essential health benefits prohibit certain cost sharing such as co-payments, deductibles, and co-insurance for these benefits. We currently have only a working definition of essential health benefits, pending a final definition from the Department of Health and Human Services. The current working definition of essential health benefits includes items and services covered under the following categories:

  • ambulatory patient services
  • emergency services
  • hospitalization
  • maternity and newborn care
  • mental health and substance abuse disorder services, including behavioral health treatment
  • prescription drugs
  • rehabilitative and habilitative services and devices
  • laboratory services
  • preventive and wellness services and chronic disease management
  • pediatric services, including oral and vision care

Cost-Sharing Limitations

In 2014, two new cost-sharing limitations take effect, with which qualified health plans must comply. The first cost-sharing limitation is an overall out-of-pocket maximum limit. This applies to deductibles, co-insurance, co-payments, or similar charges, as well as other expenditures that are qualified medical expenses. The cost sharing for these out-of-pocket expenses cannot exceed the maximum out-of-pocket expense limits for self-only and family coverage for HSA-compatible high deductible health plans during each taxable year. If we applied today’s corresponding limits, the out-of-pocket maximum for self-only coverage would be $5,950, and $11,900 for family coverage. These limits increase annually according to a “premium adjustment percentage” for the calendar year as determined by HHS.

The other cost-sharing limitation is a maximum deductible, which applies for the small group market. The maximum deductible for the self-only coverage is $2,000, and all other plans it is $4,000. These amounts will be increased by the maximum amount of reimbursement that is reasonably available to a participant under a flexible spending arrangement.

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