Health Reform WK-EDGE Health plan issuers lazy about formal policies and procedures
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Tuesday, February 9, 2016

Health plan issuers lazy about formal policies and procedures

By Kayla R. Bryant, J.D.

CMS’ 2014 plan year compliance reviews revealed that qualified health plan (QHP) issuers failed to have adequate policies in place for many areas, including casework, agent and broker oversight, and enrollment periods. In a webinar, the agency recommended that QHP issuers adhere to best practices for federally-facilitated marketplace (FFM) activities and create comprehensive documentation of policies and procedures. These should be maintained for ten years and reviewed annually (2014 Plan Year Compliance Report, January 27, 2016).

Reviews. CMS conducted compliance reviews of 23 unique issuer IDs, mandated by regulations found at 45 C.F.R. Section 156.715. These reviews revealed common compliance issues in FFMs for plan years beginning January 1, 2014, in 13 different functional areas. CMS emphasized that even when issuers conducted activities in compliance, official policies were found to be lacking.

Oversight concerns. According to the report, issuers must investigate and resolve casework through the Health Insurance Casework System (HICS). This requires checking the system daily and resolving any cases within a certain timeframe. CMS found that many issuers did not have policies that included language regarding these specified requirements. Issuers must also verify that agents and brokers facilitating enrollment in QHPs are properly registered, trained, and licensed. Many issuers did not have policies ensuring that all agent/broker qualifications were verified. Similar issues extended to delegated and downstream entities, which issuers are required to ensure do not employ tactics that discourage enrollment in QHPs.

Enrollment. Issuers’ policies were also lacking to ensure that enrollment periods and processes were properly executed. Issuers must enroll individuals through annual open enrollment periods, while allowing for special enrollment periods in certain cases only after eligibility determinations have been received. They must offer certain effective dates of coverage and communicate this properly to consumers, and maintain high security standards for protected health information. CMS found that even if issuers were in compliance with these standards, many failed to develop complete formal policies to ensure that the requirements were clearly outlined.

Future reviews. Going forward, CMS warned issuers that they could expect an increased usage of enforcement remedies for non-compliance. These remedies will follow the severity and scope of the non-compliance. CMS may conduct standard, expedited, or targeted reviews. To ensure compliance, all issuers should have formal documentation for policies and processes for all areas of FFM activities. All health insurance issuer standards under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) can be found at 45 C.F.R. Section 156.

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