The Department of Health and Human Services (HHS) has released its Notice of Benefit and Payment Parameters for 2022 Final Rule Part Two, which becomes effective on July 6, 2021. The final rule is largely targeted to insurers and Exchange regulators; however, employers and health plan advisors should take note of several provisions that could potentially impact their health plans, including the following:
Annual Cost-Sharing Limit Increases
The annual maximum cost-sharing limit for self-only coverage in 2022 will increase to $8,700, from $8,550 in 2021. For all other coverages, the annual maximum cost-sharing limit will increase to $17,400 in 2022, from $17,100 in 2021. The 2022 limit increases are the result of a return to procedures used from 2015-2019 in cost of coverage calculations and will also affect the indexing of employer shared responsibility penalties as well as the affordability of employer-sponsored plans.
COBRA and Exchange Special Enrollment
The HHS’ final rule addresses a number of special enrollment period rules, including a few that will affect COBRA coverage. The HHS has finalized a policy to codify that individuals with COBRA coverage may qualify for a special enrollment period (SEP) to enroll in individual health insurance coverage on- or off-exchange based on the cessation of employer contributions or government subsidies (such as those provided for under the American Rescue Plan Act of 2021) to COBRA continuation coverage. The final rule also permits those enrolled in the Exchange who qualify for a SEP due to the loss of APTC eligibility to switch to a new plan. In addition, individuals who did not receive timely notice of a SEP triggering event and were therefore unaware of the triggering event are allowed to choose a new qualified health plan within 60 days of the date the individual knew or reasonably should have known about the triggering event.
Medical Loss Ratio (MLR) Reporting and Rebates
Issued in January 2021, the first Notice of Benefit and Payment Parameters for 2022 final rule addressed how drug manufacturer coupons are counted for the purpose of MLR calculations as well as how they accrue toward annual cost-sharing limits. Part Two of the final rule defines drug rebates and other price concessions that insurers are required to deduct from incurred claims for MLR reporting and rebate calculation purposes – including coupons, discounts, cost-reduced services – beginning with the 2022 MLR reporting year.
Part Two also extends a temporary COVID-19-related policy that permitted insurers to prepay estimated MLR rebates as premium credits for 2019. For MLR reports filed in 2021 for the 2020 reporting year, insurers are allowed to prepay estimated MLR rebates at any time during the year, no matter the form in which they are paid. For insurers offering temporary premium credits during a public health emergency, Part Two clarifies the MLR reporting and rebate requirements beginning with MLR reports filed in 2022 for the 2021 reporting year.
HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 678-439-6236.
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