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CMS to Regulate Qualified Health Plan (QHP) Network Adequacy

Starting Plan Year 2023, the Centers for Medicare & Medicaid Services (CMS) is responsible for imposing the regulations for the Qualified Health Plan (QHP) certification process, including network adequacy standards and reviews. This change was affirmed in the second final rule, HHS Notice of Benefit and Payment Parameters (also known as “2022 Payment Notice”). Specifically, changing the portions of the 2019 Payment Notice, which eliminated federal reviews of network adequacy of QHPs offered through the Federally-facilitated Exchanges (FFE) in certain circumstances.  This change does not impact states with State-based Exchanges that can (and do) impose their network adequacy standards and reviews.

What does the Federal Review of Network Adequacy mean to health plans?

QHP Data Submission and Certification Timeline
  • The network adequacy standards and review process will not change for Plan Year 2022.
  • For health plans offering products on the Exchange in any of the 30 FFE states, further clarification about network adequacy regulations will be forthcoming in a future rule.
Network Adequacy Review Process
  • HHS will need to set up a new network adequacy review process. This gives CMS an opportunity to evaluate previously finalized network adequacy standards and review processes – and potentially refine them.
  • CMS acknowledges QHP issuers will need sufficient time before the applicable plan year to assess that their networks meet the new regulatory standard, submit network information, and have the information reviewed by applicable regulatory authorities in order for their plans to be certified as QHPs. Issuers may also need to contract with new providers to meet the standard. This likely means that CMS will be engaging formally with issuers and other stakeholders through a new rulemaking process (likely through a forthcoming 2023 Proposed Notice of Benefits and Payment Parameters for Plan Year 2023 expected in the fall of 2021).

What are the industry implications?

Quest Analytics knows the industry across all major health insurance markets and offers the following guiding principles as CMS and stakeholders prepare for the return of federal Exchange standards and oversight of network management:

  • Follow a known industry methodology, such as Medicare Advantage, for measuring networks. This would reduce the burden and increase efficiencies both for CMS and health plans.
  • At the same time, adjust any adopted industry standard as appropriate to address specific demographic, social, and health care utilization characteristics of the QHP market and the consumers served by this market, without destabilizing existing choices for consumers.

 

Recommended Reads

Access our top legislative briefs about QHP Network Adequacy.

Download our Legislative Brief: Federal Court Vacates 2019 Payment Rule on Federal Review of Network Adequacy

Read our Legislative Brief: HHS Notice of Benefit and Payment Parameters for PY 2022

 

References:

HHS Notice of Benefit and Payment Parameters for 2022 Final Rule: https://www.federalregister.gov/documents/2021/05/05/2021-09102/patient-protection-and-affordable-care-act-hhs-notice-of-benefit-and-payment-parameters-for-2022-and

Notice of Benefit and Payment Parameters for 2022 Final Rule Part Two Fact Sheet: https://www.cms.gov/newsroom/fact-sheets/notice-benefit-and-payment-parameters-2022-final-rule-part-two-fact-sheet