HealthReformGPS is made possible through generous financial support from the RCHN Community Health Foundation. Visit them at

Update: Frequently Asked Questions on Patient Cost-Sharing Under the ACA – Set 12

Posted on May 16, 2013 | Comment (1)

PDF Version
Implementation Briefs
Key Developments

By Sara Rosenbaum


CCIIO has recently posted a set of FAQs on patient cost-sharing. The FAQs offer additional insight into the agency’s views regarding the scope of coverage under the Affordable Care Act.


The ACA contains numerous provisions affecting patient cost-sharing, both generally and in relation to specific services. Some of the provisions (such as those related to preventive services and annual limits on out-of-pocket cost-sharing) apply across multiple coverage markets (i.e., to health insurance products sold in both the individual and group markets as well as to self-insured plans). Other provisions, such as those governing deductibles applicable to the essential health benefit (EHB) package, apply only to those markets that are subject to the EHB requirement, i.e., health plans sold in the individual and small group (under 100 full-time employees) market. In general, the cost-sharing rules exempt grandfathered health plans.

The FAQs

FAQ 1: Deductibles in the small group market

Deductible limits are part of the EHB coverage requirement, which applies to the individual and small group markets. PPACA §1302(c)(2)(C), which implements the EHB statute, permits deductibles to rise if issuers cannot reasonably reach the plan’s required metal tier coverage level (i.e., gold, silver, bronze) without raising the deductible. Final EHB regulations issued by HHS in November 2012 reflect this provision. FAQ 1 clarifies HHS’ intent that the reasonableness limits on deductible increases in the group market apply only to the EHB-governed market and not to either large-insured plans (which are not covered by the EHB statute) or to self-insured plans. These plans remain free to raise their deductibles without regard to the reasonableness test.

FAQ 2. Limits on out-of-pocket maximum cost-sharing

The ACA amends both the Public Health Service Act (which regulates the insured market) and ERISA (which regulates both the insured and self-insured market) to establish limits on the maximum amount of out-of-pocket exposure that insured individuals and families can bear for covered benefits. FAQ 2 clarifies that unlike the deductible rule, the rule limiting out-of-pocket maximum exposure applies to all health plans (insured or self-insured, individual or group markets) unless they retain their status as grandfathered health plans. Furthermore, the FAQ clarifies that where a health plan uses more than one service provider (e.g., one for major medical, another for behavioral, and another for pharmacy), the plan administrator will be expected to manage all three components so that together, their out-of-pocket maximums do not exceed the limit allowed under law. This expectation of cross-service coordination among the various plan components will be phased in beginning with the January 1, 2014, plan year, in order to give issuers some leeway to establish compliance systems. (Pediatric dental coverage, which, although part of the EHB package, is subject to separate premium assistance and cost-sharing rules, continues to be treated separately for purposes of this consolidated approach). The FAQ also reinforces the fact that under the mental health and addiction parity statute, plan administrators cannot apply separate out-of-pocket maximums to medical and behavioral health coverage.

FAQ 3- FAQ 20. Preventive Services

The ACA amends both the Public Health Service Act and ERISA to require coverage of preventive services on a first dollar basis to all non-grandfathered individual and group health plans.

Interim final regulations issued in July, 2010 (75 Fed. Reg. 41726) specify that plans remain free to use reasonable medical management techniques to set coverage limitations related to frequency, method, treatment, or setting, unless such details are specified in the official guidelines that define the level of coverage. Under the Act, coverage recommendations are set by various scientific bodies and federal agencies (CDC’s Advisory Committee on Immunization Practice (ACIP) in the case of immunizations, HRSA for women’s and children’s preventive services, and the U.S. Preventive Services Task Force (USPSTF) in the case of other preventive services).

FAQ 3 clarifies that under this rule, out-of-network screening services must be covered on a first-dollar basis when no in-network provider is accessible. (“. . [I]f a plan or issuer does not have in the network a provider who can provide the particular service, then the plan or issuer must cover the item or service when performed by an out-of-network provider and not impose cost-sharing with respect to the item or service.”)

FAQ 4 provides that aspirin (recommended to reduce heart attack risk) must be covered without cost-sharing if prescribed by a health care provider.

FAQ 5 specifies that the screening colonoscopy exam, covered as a preventive service without cost-sharing, includes removal of polyps as an “integral part” of the exam.

FAQ 6 clarifies that genetic counseling and evaluation for routine breast cancer susceptibility for the BRCA gene (which heightens the breast cancer risk), includes the BRCA test itself, which must be furnished as a preventive screen without cost-sharing.

FAQ 7 clarifies that when a USPSTF recommendation refers to certain services for “high risk” populations, the discretion to determine whether an individual is at “high risk” and therefore should be screened lies with the clinician and, if such a determination is made, the screening service must be furnished without cost-sharing. Similarly, FAQ 8 clarifies that ACIP recommended routine immunizations must be furnished without cost sharing even in the case of certain immunizations that are recommended as routine by the ACIP only for certain populations, for example, routine recommendations based on age or risk factors or on a catch-up basis. FAQ 8 also clarifies that routine immunizations are covered when delivered on an in-network basis (unless, as noted in the earlier FAQ, no in-network provider who furnishes the immunization is accessible).

FAQ 8 also clarifies the considerable wait that may apply in the case of immunization recommendations. This wait consists of the plan year (or policy year in the case of the individual market) that begins on or after the date that is one year after the date of the ACIP recommendation. Thus, if ACIP makes a recommendation on February 1, 2013, the first date of coverage might be as early as February 1, 2014 or as late as January 31, 2015, depending on when the new plan year commences (typically January 1 of a given year).

FAQ 9 clarifies that in the case of women’s preventive services, plans may use reasonable medical management techniques to cluster various women’s preventive services into a single visit, but also clarifies that the services are covered even if they must take place over several visits. Thus, a plan could require that HIV and STD screening must take place in a single visit as related screening services. FAQ 10 acknowledges that the range of screening procedures required during an annual HRSA-recommended well-woman preventive care visit may require multiple visits to obtain all recommended procedures and specifies that clinical judgment should guide the decision as to whether multiple visits are necessary.

FAQ 11 clarifies the process of screening and counseling women related to interpersonal domestic violence and points to a 5-question “abuse assessment screening tool.” The FAQ also identifies other sources of screening tools and advisory brochures.

FAQ 12 provides clarification on when the HPV DNA test should be furnished as part of cervical cancer screening recommended for women ages 30 and older. FAQ 13 further clarifies that HIV testing is part of the screening package for women.

FAQ 14 clarifies that the interim regulations, which specify coverage of all FDA-approved contraceptive methods, sterilization procedures, and patient education for all women with reproductive capacity, do in fact cover all FDA-approved contraceptive methods, such as long-lasting reversible contraceptives including intra-uterine devices and contraceptive implants (further discussed in FAQ 17). The FAQ also clarifies that plans can use medical management techniques to promote efficiency, such as the use of generics when available and appropriate. FAQ 15 specifies coverage of over-the-counter contraceptive methods when clinically prescribed. FAQ 16 further clarifies that coverage of contraceptives as a preventive service without cost-sharing includes “follow-up and management of side effects, counseling for continued adherence, and device removal”, all of which would be subject to reasonable medical management with respect to frequency, method, or treatment setting.

FAQs 18-20 provide further elaboration on coverage of breast-feeding counseling, recommended by both the USPSTF and HRSA. The FAQs make clear that reimbursement methods fall outside the scope of the recommendations and thus fall within plan discretion. The FAQs also make clear that while the counseling and support services last throughout the breast-feeding period, plans have the power to manage frequency, method, treatment, and setting. FAQ 20 makes clear that coverage includes the cost of renting or purchasing lactation supplies.


FAQs are advisory only and do not have the force and effect of law. Will the three agencies incorporate these responses into final preventive services regulations, which have not yet been issued?




Comment (1)

The temporary risk corridors program allows the federal government to share a QHP’s profits or losses among other QHP issuers due to inaccurate rate setting inside the Exchanges from 2014-2016. To determine whether a QHP issuer has inaccurately set premium rates that lead to an unjustified profit or loss, a QHP’s “allowable costs” must be calculated per the requirements in the Premium Stabilization Rule. The IFR modifies the definition of “allowable costs” such that a QHP’s allowable costs are to be determined based on its pro-rata share of the QHP issuer’s incurred claims for all non-grandfathered health plans within a state, and allocated to the QHP based on premiums earned by the issuer in the market...
This update to our March 2012 implementation brief reviews recent implementation efforts by the Administration in connection with coverage of contraceptives as a required element of required preventive services for all individual and (non-grandfathered) group health plans under the Affordable Care Act. The earlier brief reviewed the Administration’s final rules defining the scope of contraception coverage, as well as the scope of the religious exemption that would apply to employers that seek an exemption from this coverage requirement. Reflecting prior law on this matter, the final rule preserved...
According to a survey released by the Kaiser Family Foundation (KFF), preventive health services are well-covered by state Medicaid programs, despite the fact that these services are optional for nonelderly adult Medicaid enrollees. The KFF study reported that 44 states covered a least 30 out of 42 optional preventive services, with 25 states covering 40 or more of the optional preventive services. These optional services include 1) screening for cancer and sexually transmitted infections, 2) services related to chronic conditions such as diabetes, and 3) immunizations. There was significant variation with regard to cost-sharing requirements for these services. Of the 13 states that covered all of the 42 preventive services, only five of these states covered these services without cost sharing. The Affordable Care Act (ACA) makes available financial incentives for covering these preventive services. State Medicaid programs, for example, may receive an increased federal Medicaid matching rate if they cover immunizations recommended by the Centers for Disease Control and Prevention and certain preventive services recommended by the U.S. Preventive Services Task Force.
The Commonwealth Fund recently published a paper in Medscape Public Health regarding preventive health services under the Affordable Care Act (ACA). The law has already extended coverage to dependents through age 26. By 2014, Medicaid will expand to cover most low-income adults and the exchanges will extend insurance to many small business and individuals. This eminent expansion of health insurance coverage will greatly increase in the use of preventive services in the United States. ACA provisions also eliminate cost sharing associated with the provision of preventive services, which will also likely impact use. Finally, the movement toward medical homes will also augment the use of preventive services. The paper discusses these relationships in the context of delivery system reforms.
The Centers for Medicare and Medicaid Services has announced a final rule with comment period eliminating cost sharing for most preventive services and reduces other out-of-pocket costs.
In comments on the interim final rule requiring health insurers cover preventive services, the ERISA Industry Committee (ERIC) stated that the "interim final regulations ... appear to require plans to provide services that significantly exceed those that our members currently provide," and expressed concern that it "has become increasingly difficult for companies to maintain comprehensive group health plans ... as medical costs continue to grow at unsustainable rates."
The Department of Health and Human Services has released interim final rules and recommendations requiring that health insurance plans issued on or after September 23, 2010 offer certain preventive services without cost-sharing to patients.