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3. Exchange Functions in the Individual Market: Eligibility Determinations for Exchange
Participation and Insurance Affordability Programs
a. Annual eligibility redetermination (§155.335)
The current re-enrollment provisions codified at §155.335(j) prioritize re-enrollment with
the same issuer in the same or a similar plan with the goal of maximizing continuity of coverage
and care. However, because premiums may change significantly from one year to the next, the
plans that are most competitively priced in one year may not continue to be the most
competitively priced in subsequent years. For this reason, default enrollment in the same or
similar plan may sometimes encourage consumers to remain in plans that are significantly more
expensive than the lowest cost plans in the market. Because we believe that many consumers
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place a high value on low premiums when selecting a plan, we believe that consumers could
benefit from alternative re-enrollment hierarchies.
In particular, we are exploring implementing in the FFE an approach under which an
enrollee, at the time of initial enrollment, would be offered a choice of re-enrollment hierarchies
and could opt into being re-enrolled by default for the subsequent year into a low-cost plan (such
as the QHP of the same metal level with the lowest premium in the enrollee’s service area, or
one of the three such QHPs with the lowest premiums by random allocation), rather than his or
her current plan or the plan specified in the current re-enrollment hierarchy. This alternative
enrollment hierarchy could be triggered if the enrollee’s current plan’s premium increased from
the prior year, or increased relative to the premium of other similar plans (such as plans of the
same metal tier), by more than a threshold amount, such as 5 percent or 10 percent. As is the
case under the existing approach, a consumer would retain the option to take action to enroll in a
different plan during open enrollment if he or she wished to do so. We are considering applying
an alternative hierarchy for the first time when re-enrolling consumers for the 2017 coverage
year. On this timeline, consumers could opt in to the alternative hierarchy during open
enrollment in 2015 (or during special enrollment periods occurring during 2016).
We seek comment on such an approach, including with respect to how to ensure that
consumers understand the risk of being default re-enrolled in a plan with a significantly different
provider network, benefits, cost-sharing structure, or service area; what premium growth in the
current plan (or what growth relative to other similar plans) would trigger re-enrollment into a
low-cost plan, and how to determine which enrollees get assigned to which plans, if random
enrollment into one of the three lowest cost QHPs of the metal level in the enrollee’s service area
is implemented. We also seek comment on how these types of default re-enrollment procedures
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have functioned in other programs and settings, and what lessons can be drawn from those
experiences. Finally, we seek comment on whether such approaches may influence issuers’
pricing decisions, such as by causing them to price more competitively in order to retain or
attract enrollees who have opted to be re-enrolled into a low-cost plan.
We are also considering providing this flexibility to State-based Exchanges to implement
alternative re-enrollment hierarchies such as the one described above, beginning in 2016, at their
option. We believe that providing this flexibility could offer an opportunity to gather valuable
information about alternative re-enrollment structures and share lessons learned across
Exchanges in hopes of improving the re-enrollment process and the consumer experience.
We seek comment on whether to permit State-based Exchanges the flexibility to
implement these alternative re-enrollment hierarchies beginning with 2016 open enrollment,
whether to provide flexibility to SBEs to establish other hierarchies, and whether to adopt any
such alternatives in the FFE for 2017 open enrollment. |
