The Center for Consumer Information and Insurance Oversight (CCIIO) on Aug. 3 issued new guidance on silver loading premiums in the public health insurance exchanges, telling insurers that if they want to raise the rates of silver-level plans to account for the loss of cost-sharing reduction (CSR) payments, they ought to do so in a way that doesn’t end up penalizing customers who don’t qualify for subsidies.
“CMS encourages states to allow issuers to offer and market plans that will be available exclusively off-Exchange and will not include any CSR load,” the guidance stated.
According to Cori Uccello, a senior health fellow at the American Academy of Actuaries, “the idea behind the loading for only exchange-based silver plans, what that does is [it] protects people who don’t have premium subsidies from having to pay that extra premium for the CSR load.” She adds, “it helps people who don’t have premium subsidies, and it doesn’t hurt people with premium subsidies because their subsidies will increase to cover the extra premium load.”
As federal regulations require insurers to offer the same qualified health plan at the same rate regardless of whether it is sold inside or outside of the ACA exchanges, “[t]o maintain the same rate both inside and outside the marketplace, some insurers applied the CSR load to off-marketplace plans as well,” wrote Katie Keith, a principal at Keith Policy Solutions, LLC.
CMS’s guidance, though, has an answer for that quandary, saying insurers can offer an off-exchange plan that’s similar, but not identical, to the “loaded” on-exchange plan.
What’s not yet clear is how many additional states were already planning to take that approach in 2019 — and whether CCIIO’s new guidance will change that number, according to Uccello.