HHS Announces Proposed Increase to Cost-Sharing Maximums

Issue Date: March 2020

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The Centers for Medicare & Medicaid Services (CMS), a part of the Department of Health and Human Services (HHS), has released the proposed Notice of Benefit & Payment Parameters for 2021. The notice announces an increase to cost-sharing (out-of-pocket) maximums under healthcare reform.

Background

Healthcare reform applies an overall “cost-sharing limit” on essential health benefits under non-grandfathered group health plans. In general, the term “cost-sharing” includes deductibles, coinsurance, copayments, or similar charges, as well as any other expenditure required of an insured individual which is a qualified medical expense with respect to essential health benefits covered under the plan. “Cost-sharing” does not include premiums, balance billing amounts for non-network providers, or spending for non-covered services.

Cost-sharing Maximums

The proposed cost-sharing maximums represent an approximately 4.9 percent increase above the 2020 parameters.

  2019 2020 Proposed 2021
Self-only $7,900 $8,150 $8,550
Other than self-only $15,800 $16,300 $17,100

Summary

The proposed self-only 2021 cost-sharing maximum is $8,550. The proposed other than self-only 2021 cost-sharing maximum is $17,100. The proposed increase to cost-sharing maximums was announced on February 6th, 2020 and the comment period closed on March 2nd, 2020.[1]

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[1] https://www.federalregister.gov/documents/2020/02/06/2020-02021/patient-protection-and-affordable-care-act-hhs-notice-of-benefit-and-payment-parameters-for-2021