On December 16, the Centers for Medicare & Medicaid Services (CMS) issued the Notice of Benefit and Payment Parameters final rule and the final Annual Letter to Issuers for 2018. The primary focus of the notice—risk stabilization—complements recent announcements that are meant to improve the risk pool, including actions to address third-party payments of premiums and improve program integrity for special enrollment periods.

“The improvements announced today build upon years of work to implement a Marketplace that is capable of providing high quality, affordable coverage to all Americans no matter their health status, their income, or where they live” said CMS Acting Administrator Andy Slavitt, quoted in a press release. “The Administration will leave the Marketplace on a stable path that, when fully implemented, will ensure quality coverage is available for all Americans well into the future.”

CMS says its new risk adjustment model will: (1) account for the number of individuals who had a Marketplace plan for less than 12 months; (2) better account for the risk of high-cost patients; (3) improve compensation for healthier members; and (4) use prescription drug data as another way to account for sicker members.

In addition to these modifications to risk adjustment, the final rule and issuer letter contain other provisions to improve the Marketplace consumer experience and strengthen the individual and small group markets as a whole. A fact sheet on the major provisions of the final rule can be found on the CMS website.