Final Notice of Benefit and Payment Parameters for 2020

 April 30 2019     Diane Cross

The Centers for Medicare & Medicaid Services (CMS) published its final Notice of Benefit and Payment Parameters for 2020 last week, which is issued annually and adopts changes for the next plan year.  This final rule primarily affects the individual market and the Exchanges, but also addresses various Affordable Care Act (ACA) provisions and related topics that impact employer-sponsored group health plans.  Some of the highlights include:

Annual Limit on Cost Sharing
The ACA requires non-grandfathered plans to comply with an out-of-pocket maximum on expenses for essential health benefits. This is updated annually and for 2020, the maximum out-of-pocket is $8,150 for self-only and $16,300 for family coverage (respectively, a $250 and $500 increase from 2019). 

Employers should keep in mind that this is different from the out-of-pocket maximums for High Deductible Health Plans (HDHPs) as set by the IRS. The ACA out-of-pocket limit also differs from the HDHP out of pocket limit in that it requires that the self-only limit is “embedded” in the family maximum. This means that no one individual within a family can experience out of pocket expenses greater than the self-only limit (even if the family has not collectively reached the family out of pocket).

Prescription Drug Provisions
If there is an available and medically appropriate generic equivalent, plans may exclude drug manufacturer coupons from counting toward the out-of-pocket maximum beginning in 2020. This is applicable to individual market, small group, large group and self-insured group health plans.

Treatment for Opioid Addiction
With the nationwide opioid crisis, the final regulations encourage every health insurance plan to provide comprehensive coverage of medication-assisted treatment (MAT). Discrimination concerns are discussed at length, reminding that if a plan covers MAT for other conditions but excludes it for opioid use treatment, the issuer must be able to justify such exclusion with supporting documentation explaining how the plan is not discriminatory.

CMS also noted that it will take comments into consideration regarding “silver loading” for future policy making. As a result of cost-sharing reduction payments being eliminated in 2017 (see prior blog post on the topic), many insurers increased premiums in 2018 and 2019 on silver level health plans to compensate for the loss of the cost-sharing reduction payments. This practice of “silver loading” has led to higher premium tax credits. That said, the Department of Health and Human Services (HHS) requested comments on ways to address this practice for future plan years.

Generally, the regulations are effective for plan years beginning on or after January 1, 2020.  In addition to the final rule, CMS also released a fact sheet regarding benefit payment and parameters for 2020.  Please contact your HORAN representative with any questions.