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HHS finalizes ACA insurance market, rate review rule

February 22, 2013

The Department of Health and Human Services today issued a final rule implementing insurance market reforms that prohibit health plans from denying coverage due to pre-existing medical conditions or charging individuals and small employers higher premiums based on health status or gender. The rule generally allows individual and small group premiums to vary based on family size, geography, age and tobacco use only; and directs individual and small group plans to accept everyone who applies for coverage. The rule also requires insurers to maintain a single risk pool for the individual market and a single risk pool for the small group market; and outlines standards for enrollment in catastrophic plans for young adults and people who cannot otherwise afford health insurance. In addition, the rule revises the timeline for states to propose thresholds for rate review, requires health plans to submit data on all proposed rate increases in a standardized format and modifies the criteria for an effective state rate review program. Most of the rule's provisions take effect 60 days after publication in the Feb. 27 Federal Register and apply to health plan or policy years beginning in 2014.