Proposed 2023 OOP Limits and ALE Penalties
Dec 31, 2021
Federal regulators have announced publication of proposed 2023 rules for several Affordable Care Act (ACA) requirements, summarized in this fact sheet and overview guidance.
Employers will be particularly interested in the premium adjustment percentage being proposed to index to 1.4408219719 (about 4.6% higher than 2022). This is used to index maximum out-of-pocket cost-sharing for non-grandfathered health plans and to calculate §4980H penalties for applicable large employers (ALEs).
| Annual Out-of-Pocket Maximum for Non-Grandfathered Health Plans always rounded down to nearest $50, and family always twice the per-person limit |
2021 | 2022 | 2023 |
| Per Person | $8,500 | $8,700 | $9,100 |
| Per Family | $17,100 | $17,400 | $18,200 |
| ALE Penalties always rounded down to nearest $10 |
2021 | 2022 | 2023 |
| §4980H(a) Penalty | $2,700/yr ($225.00/mo) |
$2,750/yr ($229.17/mo) |
$2,880/yr ($240.00/mo) |
| §4980H(b) Penalty | $4,060/yr ($338.33/mo) |
$4,120/yr ($343.33/mo) |
$4,320/yr ($360.00/mo) |
There are a couple more points of interest to employers which may affect 2023 plan designs and claims projections. These two proposals are described in the announcement as follows.
- “The 2023 Payment Notice proposed rule also would explicitly prohibit health insurance issuers from discriminating on the basis of sexual orientation and gender identity.”
- “Additionally, this proposal refines the Essential Health Benefits nondiscrimination policy by requiring issuers to rely on clinical evidence as a basis of the health plan design.”
- “For example, plans could not be designed to burden people managing chronic conditions with inordinately high prescription costs, absent a clinical rationale.”
IMA will continue to monitor regulator guidance and offer meaningful, practical, timely information.
This material should not be considered as a substitute for legal, tax and/or actuarial advice. Contact the appropriate professional counsel for such matters. These materials are not exhaustive and are subject to possible changes in applicable laws, rules, and regulations and their interpretations.
