CMS Tightens Special Enrollment Periods for ACA Plans

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By Sara Hansard

May 6 — People who move won't be able to immediately sign up for health insurance under the ACA unless they have had qualified coverage during a 60-day period beforehand under a rule released May 6 by the CMS.

The rule also includes provisions designed to help struggling nonprofit CO-OP plans created under the health-care law.

Tightening requirements for people who enroll in Affordable Care Act coverage outside of the normal enrollment periods has been a top priority for health insurers, which have cited evidence that people who sign up during so-called special enrollment periods have higher medical claims. The interim final rule (RIN:938-A S87; CMS-9933-IFC) is an attempt by the Centers for Medicare & Medicaid Services to make the ACA plans less unprofitable for insurers, most of which have been losing money on the ACA plans.

“One of their biggest complaints is people were moving and getting a special enrollment period without being covered before,” Timothy Jost, a consumer representative to the National Association of Insurance Commissioners, told Bloomberg BNA May 6.

“Linking special enrollment periods for a permanent move to prior coverage is an important step towards helping stabilize the market and will also encourage people to stay continuously covered, so they can get the coordinated care and preventive services they need,” Alissa Fox, senior vice president of the Blue Cross Blue Shield Association, said in a release May 6. “We will continue to work on additional measures to stabilize the marketplace.”

Most of the regulations of the interim final rule take effect May 11 with some requirements taking effect July 11. The CMS is taking comments until July 5.

Special Enrollments Limited

A fact sheet released by the CMS said the interim final rule makes it clear that the special enrollment periods “are only available in six defined and limited types of circumstances.”

People can qualify for a special enrollment period after a permanent move only if they had minimum essential coverage “for one or more days in the 60 days preceding the permanent move,” unless they lived outside of the U.S. or were living in a U.S. territory, the fact sheet said.

“This ensures that individuals are not moving for the sole purpose of obtaining health coverage outside of the open enrollment period,” the fact sheet said.

The six circumstances in which special enrollment periods will be allowed are:

  •  losing other qualified coverage,
  •  changes in household size,
  •  changes in residence,
  •  changes in eligibility for financial help,
  •  errors made by marketplaces or plans, or
  •  specific situations such as changing between Medicaid and marketplace coverage.


CO-OP Program

In addition to changes in the rules governing special enrollment periods, the interim final rule included the CMS's attempt to find ways to make more business opportunities for the Consumer Operated and Oriented Plans created under the ACA. The government-funded plans have been losing money and 12 of the 23 CO-OPs have closed or are in the process of being closed.

Under the interim final rule, the nonprofit health insurers will have new opportunities to enter into affiliations or capital-raising transactions available to other private insurance companies, according to a release from CMS spokesman Aaron Albright.

“We are encouraging CO-OPs to consider seeking additional sources of capital as they plan for the year ahead,” Albright said in the release.

Director Changes

The interim final rule removes the requirement that a majority of voting directors be members of the CO-OP and that all directors be elected by a vote of CO-OP members, the fact sheet said. But a majority of directors must still be elected by the members of the CO-OP, it said.

The rule clarifies that if a CO-OP temporarily fails to meet the requirement that at least two-thirds of its plans be qualified health plans in the individual or small group market, the Department of Health and Human Services “would not necessarily require early loan repayment,” the fact sheet said.

The CO-OP would have to be in compliance with requirements to offer silver and gold tier plans and have specific timetables to meet the two-thirds requirements, the HHS said.

If a CO-OP sells or converts policies to non-CO-OP issuers in connection with the wind-down of its business the CMS may accelerate repayment of loans made to the CO-OP or terminate the loan agreement, the fact sheet said.

But “in the appropriate circumstances, to preserve coverage for enrollees upon insolvency of the issuer, notwithstanding these remedies, HHS recognizes that a CO-OP could elect to enter into such a transaction,” it said.

The federal government has provided $2.5 billion in solvency and start-up loans to the 23 CO-OPs that went into operation. A total of $1.2 billion of the loans have gone to the 12 CO-OPs that failed or are not taking new members.

To contact the reporter on this story: Sara Hansard in Washington at

To contact the editor responsible for this story: Kendra Casey Plank at

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