CMS Finalized Exchange Guidance for 2022

Update: In February, CMS finalized timelines for certification and rate filings of Qualified Health Plans that will be offered in Marketplaces in 2022. 

The Centers for Medicare and Medicaid Services (CMS) finalized the Notice of Benefit and Payment Parameters for 2022 (NBPP) on January 19th, 2021, as the Trump administration was leaving office. The Letter to Issuers on the Federally-facilitated Exchanges (Letter) has not yet been finalized, however—leaving some key guidance in proposed form as the Biden administration entered office.

In December, Health Policy News outlined key changes proposed to the 2022 NBPP and Letter from prior years. This article provides updates based on the final NBPP.

Background and Considerations

The NBPP addresses financial parameters and guidance for Exchanges and Qualified Health Plans (QHPs). In finalizing the 2022 guidance on its short timeline, CMS eliminated a number of proposed provisions—confirming only the most significant changes and leaving the remainder to future rulemaking (now under the Biden administration). Topics that were included in the proposed regulations but not addressed in the final regulations include: cost-sharing limitations, Essential Health Benefits, Medical Loss Ratio, Risk Adjustment, special enrollment periods, direct enrollment standards, and pharmacy benefit manager standards.

Notably, the final rule does not address the final premium adjustment percentage, which must be updated annually and affects, among other things, cost sharing limitations for QHPs. This will need to be set by the new administration via follow-up rulemaking or in the final Letter. Also not addressed in the final NBPP is the timeline for states to change the Essential Health Benefit benchmark for 2023. However, those filings typically are not due until the spring prior to the coverage year, which leaves more time for that date to be announced.

In reviewing the finalized provisions, it is important to be mindful of the high likelihood that the Biden administration will make changes to these provisions and others—as well as to changes previously made to Exchanges, QHPs, and other Patient Protection and Affordable Care Act (ACA) guidance (similar to what took place with 2017’s Market Stabilization Rule). In fact, because the final NBPP does not go into effect until March 15th, 2021, the rule will likely be subject to a regulatory freeze under the new administration, which is reviewing all regulations and guidance and considering whether to postpone the effective date of final but not yet effective rules. In his Executive Order issued on January 28th, President Biden specifically called on his administration to review policies that may undermine the Exchange and coverage and waiver policies that may reduce coverage – both of which are addressed in the regulations, as outlined below.

Final 2022 NBPP Provisions

User Fees

As it does each year in the NBPP, CMS announced the user fees for issuers on Federally-facilitated Exchanges (FFEs) and State-based Exchanges on the Federal Platform (SBE-FPs). The final regulations maintain the proposed user fees:

  • User fees for the FFEs are reduced to 2.25 percent for 2022;
  • User fees for the SBE-FPs are reduced to 1.5 percent for 2022.

To the extent that an FFE or SBE-FP chooses to defer to direct enrollment starting in 2023—discussed further below—the user fee for either model would be reduced to 1.5 percent.

Exchange Enrollment Functions

In one of its more drastic changes to the NBPP, CMS will permit Exchanges to eliminate their enrollment function in favor of authorizing private entities to conduct direct enrollment as the sole option for Exchange enrollment. This provision eliminates the role of Exchanges as a one-stop shop to compare and enroll in QHPs and receive determinations for financial subsidies—thus gutting a cornerstone of the ACA.

To elect this new option, Exchanges must first seek federal approval. CMS clarified in the final NBPP that Exchanges will be responsible for ensuring at least one of their direct enrollment entities complies with federal requirements (such as making detailed plan information available to enrollees about all QHPs). Finally, all Exchanges are still required to meet enumerated regulatory standards and other statutory responsibilities—including displaying basic plan information, operating a hotline, and making eligibility determinations and verifications.

Per the NBPP, this option will be available in 2022 for State-based Exchanges and in 2023 for FFEs and SBE-FPs. However, we recommend keeping an eye on this provision in the coming months—it is likely to be subject to change as the Biden administration acts on its priority areas.

2018 Section 1332 Waiver Guidance

Another NBPP provision likely on the new administration’s radar is the enshrinement of 2018 Section 1332 Waiver guidance into regulations. Rather than incorporating this guidance by reference, as initially proposed, CMS directly incorporated some of its key policies into the final 2022 NBPP. These include:

  • Weakening provisions relative to the statutory guardrails that Section 1332 Waivers must meet for approval (thus making it easier for proposed waivers to be considered in compliance with these guardrails)
  • A more flexible state authority requirement
  • Provisions related to federal monitoring, compliance and evaluation

The NBPP does not further alter the rules for Section 1332 Waivers, nor make it impossible for the new administration to change these standards. However, making any changes to the provisions entails a longer process now that they are part of regulations, rather than sub-regulatory guidance.

Related Guidance

Related to this Exchange guidance, on the same day as it issued the final NBPP, CMS extended the policy allowing ongoing transitional plans—or grandmothered coverage—through 2022. Additionally, in response to the Executive Order on Strengthening Medicaid and the Affordable Care Act, issued on January 28th, CMS announced a Special Enrollment Period related to the COVID-19 public health emergency that will run from February 15th through May 15th of this year.


Health Policy News will continue to monitor the 2022 Exchange Guidance and update readers on changes, as well as additional proposals. We encourage you to stay tuned for further developments, which will likely include key changes for 2022 and beyond. If states have any questions on these policy changes, please contact us at

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