Reform Alert - News from the Blues' Office of National Health Reform

Qualified health plans: Standards for products offered in new health insurance exchanges

Nov. 04, 2011

Starting in 2014, individuals and small businesses will be able to purchase private health insurance, or qualified health plans, through state-based competitive marketplaces called exchanges. Under the Affordable Care Act, a qualified health plan is an insurance plan that is certified by an exchange, provides essential health benefits, provides coverage at a "metal level" of actuarial value (bronze (60 percent), silver (70 percent), gold (80 percent) or platinum (90 percent)), follows established limits on cost-sharing, such as deductibles, copayments, and out-of-pocket maximum amounts, and meets certain other requirements determined in the ACA, or by state exchanges. 

State exchanges must establish a uniform timeline for a QHP issuer that is not already accredited to receive accreditation. HHS will provide standards for recognizing accrediting agencies in future rulemaking. 

Exchanges will only be open to QHPs, but QHPs may be sold off the exchange. In order to be certified, QHPs must meet minimum standards. (The federal government has released a proposed rule, which includes the following items that are also outlined in the ACA.):

  • Must provide the following information to the exchange in plain language: Claims payment policies and practices; periodic financial disclosures; data on enrollment; data on disenrollment; data on the number of claims that are denied; data on rating practices; information on cost-sharing and payments with respect to any out-of-network coverage; and information on enrollee rights under Title I of the ACA. 
  • Must make available the amount of enrollee cost sharing under the individual's plan in a timely manner upon request of the individual. At a minimum, such information must be made available through a website and such other means for individuals without access to the internet. 
  • Must provide the summary of benefits and uniform coverage summaries prior to the start of the open enrollment period. 
  • Must adhere to network adequacy standards established by the state exchange. 
  • Must make its provider directory available to the exchange for publication online and to potential enrollees in hard copy upon request. 
  • Must reconcile enrollment files no less than once a month with the exchange. 
  • Required to provide HHS with information on the distribution of prescription drugs, pharmacy benefit management activities, the collection of rebates and other monies in conducting these activities, and costs incurred to provide those drugs. 
  • Prohibited from employing marketing tactics that discourage the enrollment of individuals with significant health needs. Compliance with state laws and regulations regarding marketing practices is a proposed certification standard for qualified health plan issuers. 
  • Must supply the exchange annually with information on rates, covered benefits and cost-sharing requirements. HHS intends to apply rate review standards similar to the "unreasonable" rate review reporting standards for all rate increase requests on the exchanges.

Rules related to qualified health plans and dental coverage

Exchanges must allow limited dental benefit plans to be offered through the exchange, as long as the plan covers at least the pediatric dental essential health benefit and qualifies as "standalone dental" coverage, meaning it is not included as part of a medical plan.

  • The exchange may allow standalone dental plans to be offered independently or in conjunction with a QHP. 
  • If a standalone dental coverage option is available on the exchange that covers the pediatric dental essential health benefit, health plans cannot be denied QHP status on the basis of not offering the pediatric dental essential health benefit. 

It is unclear how premium tax credits and cost sharing subsidies will be distributed between a QHP and a standalone dental plan that covers the pediatric dental essential benefits.

Rules related to QHPs and abortion coverage

The ACA prohibits the use of public funds (premium tax credits or cost sharing subsidies) to pay for non-excepted abortions per the Hyde Amendment criteria. QHPs offered on an exchange that offer non-excepted abortion coverage are required to establish separate riders for abortion coverage and implement a strict funding segregation.

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The information on this website is based on BCBSM's review of the national health care reform legislation and is not intended to impart legal advice. Interpretations of the reform legislation vary, and efforts will be made to present and update accurate information. This overview is intended as an educational tool only and does not replace a more rigorous review of the law's applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. Analysis is ongoing and additional guidance is also anticipated from the Department of Health and Human Services. Additionally, some reform regulations may differ for particular members enrolled in certain programs such as the Federal Employee Program, and those members are encouraged to consult with their benefit administrators for specific details.