Some Obamacare Enrollees Could Benefit From Funding Dispute

Senate health-care leaders may have a deal that allows federal Obamacare payments to continue to cover out-of-pocket costs for low-income people.

But, deal or no deal, it’s not clear whether 2018 premiums will reflect the approximately $10 billion in cost-sharing reduction (CSR) payments that insurers may receive under the Affordable Care Act.

Still, in 26 states, exchange enrollees who are eligible for premium tax credits (a different subsidy under the ACA) may be able to buy gold-tier plans for about the same price as lower-value silver-tier plans.

That’s because those states required carriers to add extra costs onto the silver-tier plans in the event the CSRs weren’t funded by the federal government. On Oct. 12, President Donald Trump withdrew the payments to insurers because the money hasn’t been appropriated by Congress.

Since insurers are required to cover costs to reduce costs for deductibles, copayments, and other out-of-pocket costs for low-income people, that would leave them holding the bag.

It also means premiums would rise to cover those costs. So moderate-income people getting the separate premium tax credit subsidies would get more.

“Consumers could buy gold plans once they get the tax credits almost cheaper than what they could buy silver plans for,” Christina Cousart, senior policy associate with the National Academy of State Health Policy, told me.

But consumers who don’t receive the premium tax credit subsidies would need to steer clear of the silver-tier plans in the states where insurers are including the cost of the CSRs only for silver-tier plans.

Premiums are expected to rise sharply even if the federal government covers the cost of the CSRs. Withdrawing the federal payments to insurers is likely to cause premiums to rise by an additional 20 percent, health insurance actuaries predict.

Open enrollment is scheduled to take place Nov. 1 through Dec. 15.

Read my full article here.

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