Last year there was much hand-wringing by myself and other healthcare wonks about whether or not the Trump Administration would attempt to kill off Silver Loading (and its even-wonkier cousin, Silver Switching). HHS Secretary Alex Azar and CMS Administrator Seema Verma kept sending out mixed and confusing signals about their intentions.
Eventually, Azar decided that while he doesn't like the practice, there wasn't enough time to change the rules before the 2019 Open Enrollment Period was set to begin, so he decided to take a pass for the time being.
Well, in yesterday's NBPP release, the HHS Dept. addressed the issue of CSR reimbursement funding directly...but they also made it clear that they're letting Silver Loading slide for another year:
Unfortunately, Vermont is one of the three states (along with Idaho and Maryland) which hasn't released any 2019 Open Enrollment data yet, so I don't have any numbers to report on that front. However, they did just post this "Open Letter" which I found interesting. The two things to keep in mind about Vermont are: 1) they include their own subsidies on top of ACA subsidies; and 2) they were among two states (North Dakota is the other one) which upgraded their premium pricing in 2019 from "no load" to full #SilverSwitcharoo status.
You can read about the wonky mechanics of this here, but the bottom line is that Vermont residents who qualify for subsidies have substantially better deals available this year, while unsubsidized enrollees have an important workaround to avoid being stung with extra CSR costs:
It isn't often that I write about anything Oklahoma-related, and it's rarer still that I post good news out of the...um..."labor omnia vincit" state (that's their slogan, I looked it up...), so today's a rare day indeed.
Last year I wrote a LOT about Silver Loading and Silver Switching for 2018...basically, the way which ACA individual market enrollees can save hundreds or even thousands of dollars on their 2018 insurance policies by taking advantage--perfectly legally and ethically--of the unusual pricing of different metal level policies this year.
The short version is this: Due to the way the ACA's tax credit formula works, Donald Trump's attempt at sabotaging the ACA exchanges by cutting off Cost Sharing Reduction (CSR) reimbursement payments to insurance carriers actually (partly) backfired on him, resulting in an unusual situation in which several million subsidized enrollees ended up benefitting from the pricing fallout, while millions of unsubsidized enrollees ended up being hurt by it...but other unsubsidized enrollees ended up being able to avoid being hurt by switching to a special off-exchange Silver plan (thus, the "Silver Switch").
UPDATE 10/30/18: Thanks to some additional reviews/checking by Dave Anderson, Louise Norris, Andrew Sprung and myself, I've been able to update the spreadsheet further; the blog post has also been updated correspondingly.
Many of the findings were things which I had been either predicting or documenting all year:
Enrollment through Healthcare.gov Was 5 Percent Lower in 2018 than 2017
Stakeholders Reported That Plan Affordability Likely Played a Major Role in Enrollment
HHS Reduced Consumer Outreach for 2018 and Used Problematic Data to Allocate Navigator Funding
HHS Did Not Set Numeric Enrollment Targets for 2018, and Instead Focused on Enhancing Certain Aspects of Consumers’ Experiences
We identified a list of factors that may have affected 2018 healthcare.gov enrollment based on a review of Department of Health and Human Services information, interviews with health policy experts, and review of recent publications by these experts related to 2018 exchange enrollment.
Azar Says He Is Not Aware Of Discussions On Blocking ‘Silver-Loading’ in 2019
HHS Secretary Alex Azar said that he has not been involved in discussions about blocking ‘silver-loading’ plans in 2019 and is not aware of any agency discussions about ending the practice at the moment.
...In recent weeks, some stakeholders have speculated that the Trump administration could block silver-loading in 2019. Several pro-ACA experts say that even though the administration may have authority to stop silver-loading, it would be a self-destructive move, especially leading up to the November midterm elections.
CMS Administrator Seema Verma told reporters on Thursday (March 22) that she was “very concerned” about certain aspects of ‘silver loading’ plans, namely that it raises costs for unsubsidized consumers and the federal government. Verma did not commit to allowing or blocking the process for the 2019 plan year.
No Load: They could gamble that the CSR problem would be resolved and the payments would be made after all (i.e., they would price normally).
Broad Load: They could spread the CSR cost out evenly across all of their 2018 ACA policies, on exchange & off.
Silver Load: They could load the CSR costs onto all Silver plans only (both on & off exchange).
Silver Switcharoo: They could load CSR costs onto all on-exchange Silver plans only, while also creating "mirror" Silver plans off-exchange without any CSR load.
Mixed Load: Each insurance carrier could choose whichever of the other 4 strategies they wanted to and let the chips fall where they may. Not sure if this really counts as a "strategy", since it's more or less "all of the above".
For nearly a year, healthcare wonks like myself, David Anderson, Andrew Sprung and Louise Norris have been heavily getting the word out to promote not just the "Silver Loading" CSR-load workaround, but an even more clever variant which I've coined "the Silver Switcharoo" which takes the concept of Silver Loading and goes one step further.
20 states went the full #SilverSwitcharoo route (the best option, since it maximizes tax credits for those eligible for them while minimizing the number of unsubsidized enrollees who get hit with the extra CSR load);
16 states went with partial #SilverLoading (the second best option: Subsidized enrollees get bonus assistance, though not as much as in Switch states; more unsubsidized enrollees take the hit, but they aren't hit quite as hard);
6 states went with "Broad Loading", the worst option because everyone gets hit with at least part of the CSR load except for subsidized Silver enrollees;
6 states took a "Mixed" strategy...which is to say, no particular strategy whatsover. The state insurance dept. left it up to each carrier to decide how to handle the CSR issue, and ended up with a hodge podge of the other three
3 states (well, 2 states + DC, anyway) didn't allow CSR costs to be loaded at all. Their carriers have to eat the loss, which makes little sense, but what're ya gonna do?
Implications Of CMS Mandating A Broad Load Of CSR Costs
In October 2017, the Trump administration eliminated federal funding to reimburse insurers for cost-sharing reduction (CSR) subsidies, which they are obligated to provide to qualifying enrollees in the Affordable Care Act (ACA) Marketplace. President Donald Trump had threatened to eliminate CSR funding throughout 2017, so insurers and insurance regulators in many states had anticipated the move by adding the cost of CSRs to premiums for 2018.
Louise Norris is an awesome source for all sorts of healthcare policy/insurance data, but she's especially on top of developments in her home state of Colorado, where she and her husband Jay run a small brokerage outlet.
Today Jay and Louise have a couple of interesting tidbits out of The Centennial State (yeah, I had to look up their nickname myself).
That's (sort of) an 88% retention rate through early May. I say "sort of" because this presumably includes some amount of churn (if 100 people drop coverage and 100 off-season enrollees sign up, that'd be a net change of zero). Even so, it's actually slightly better compared to prior years, when the national effectuation number had usually dropped to around 87% by the end of March.