The Facts of the Month
Here is something to mention when discussing health trends in the month ahead.
In 2024, the average annual premium for employer-sponsored family health coverage was $25,572, an increase of $1,604 (7 percent) from 2023. Over the course of the past five years, the average family premium has increased 24 percent, which is similar to growth seen in inflation (23 percent) and wages (28 percent). On average, covered workers contributed 16 percent ($1,368) of the cost of single coverage and 25 percent ($6,296) of the cost of family coverage. The average general annual deductible for single coverage for workers with a deductible was $1,787, similar to that in recent years but 47 percent higher than a decade ago.
Source: Claxton, G., Rae, M., Damico, A., Winger, A., Wager, E. “Health Benefits In 2024: Higher Premiums Persist, Employer Strategies For GLP-1 Coverage and Family-Building Benefits” Health Affairs, Volume 43, Number Ten, October 9, 2024. https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2024.01006
The Big Three
Each month PA-NABIP identifies three top public policy or legal developments that could impact our members and clients. Here are this month’s big three!
- Agent Licensing Bill Passes in the Last Days of the Pennsylvania Legislative Session
On October 9, 2024, the Pennsylvania State Senate approved S.B. 1241, a measure addressing pre-licensing education requirements for insurance agents and brokers. Senator Chris Gebhard (R-48), Vice-Chair of the Senate Banking and Insurance Committee, introduced the legislation, which was approved by the Pennsylvania House in September. Governor Shapiro is expected to sign the bill shortly.
This legislation, which is supported by PA-NABIP, would eliminate the requirement that individuals who wish to become licensed insurance producers in the Commonwealth take formalized and independently proctored pre-licensing courses before applying to take the actual state licensure examination. People will still need to pass the pre-licensing exam, that has been approved by the Pennsylvania Insurance Department. There will continue to be a requirement of 3 credit hours per licensing period specifically concentrating on ethics.
- Proposed 2026 Notice of Benefits and Payment Parameters Includes Significant Provisions Related to Individual Exchange Market Insurance Brokers
The federal Centers for Medicare and Medicaid Services (CMS) just released a proposed version of its annual health insurance market reform regulation, the 2026 Notice of Benefits and Payment Parameters. The measure includes significant provisions that would apply to health insurance brokers who sell individual coverage in federal health insurance exchange marketplace states like Delaware. These requirements would not apply to state-based exchange brokers, such as those helping people in Pennsylvania, New Jersey, New York, and Maryland.
During the first six months of 2024, CMS received more than 200,000 complaints about individuals and business entities who fraudulently accessed marketplace enrollment files using health insurance broker credentials. These people changed people’s plan selections without their knowledge or permission, in the hopes of receiving commission payments for the new plan choice. To address this problem, the proposed rule includes provisions to help CMS identify and respond to unauthorized plan switching.
The first change would allow CMS to pursue enforcement action against both individual agents and brokers who have engaged in fraudulent action. It would also allow them to pursue actions against their agency, if it is deemed that the agency is also responsible for or may be directing the fraudulent actions. The proposed rule would also expand CMS’s authority to suspend an agent or broker’s ability to transact information with the federal exchange marketplace, if they find an individual poses an unacceptable risk to the accuracy of Marketplace eligibility determinations, operations, applicants, and or enrollees.
Finally, the rule would update CMS’s existing model consent form for agents, brokers, and web brokers to use to document that a consumer or their authorized representative reviewed and confirmed the accuracy of their eligibility application information before their application was submitted to the Marketplace. The updated model consent form, if finalized as proposed, would also include scripts for agents, brokers, and web brokers to use to document compliance with the consumer consent and review, and confirmation of the accuracy of their eligibility application information requirements via an audio recording.
CMS is accepting comments on this proposed rule through November 12, 2024, and NABIP will be submitting comments on a national level. The Biden Administration is expected to finalize this measure before the start of the new presidential administration in January.
- 2026 Maximum Out-of-Pocket Limits Released
The Biden Administration just released the 2026 private health insurance out-of-pocket maximum cost-sharing limits. These limits will apply to all non-grandfathered private health insurance plans that are not qualified High-Deductible Health Plans and are sold between January 1, 2026-December 31, 2026. For self-only coverage, the most an individual will need to pay in cost-sharing will be $10,150 in 2026. The out-of-pocket limit for other than self-only coverage will be $23,300. This represents an approximately 10.3 percent increase from the 2025 parameters of $9,200 for self-only coverage and $18,400 for other than self-only coverage.
If a person buys exchange-based individual coverage and qualifies for income-based cost-sharing reductions, those cost reductions will extend to their out-of-pocket maximums as well. The 2026 reduced maximum annual limitation on cost sharing will be $3,350 for enrollees with household income greater than or equal to 100% of the federal poverty level (FPL) and $8,100 for enrollees with household income greater than 200% and less than or equal to 250% of FPL. However, these limits only apply to specific exchange-based individual coverage.
Annual maximum out-of-pocket cost limits are always less for qualified high-deductible health plans that may be paired with a health savings account. The Internal Revenue Service will release the specific limits for those plans later this year.
Check This Out!
If you want to expand your health policy knowledge beyond this newsletter, here is a resource to check out!
All employers with ten or more Delaware-based employees are about to be required to participate in a new Delaware Paid Leave (DPL) program. The law that created the DPL does not take full effect until January 1, 2026. However, many aspects of the measure take effect on January 1, 2025, and employers subject to the program need to take action before then to prepare for full implementation. Fortunately, the state has a website outlining exactly what affected businesses need to do, and how their insurance broker can help them!