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CMS extends ACA premium rate filing deadline due to change in CSR risk adjustment methodology

CMS is modifying the risk adjustment methodology in states where insurers have increased their silver plan rates due to uncertainty of CSR payments.

Susan Morse, Senior Editor

The Centers for Medicare and Medicaid Services has extended the deadline from Wednesday to September 5 for insurers to finalize their premium rates for the Affordable Care Act marketplace.

The reason is cost-sharing reduction payments. In those states that have allowed insurers to file higher premium rates reflecting an end to CSR payments, CMS is modifying its risk adjustment methodology.

President Trump has threatened to end the payments, but the Department of Health and Human Services' current risk adjustment methodology reflects no change, CMS said.

Numerous insurers have filed higher rates for their silver level plans for 2018 based on an end to CSRs.

[Also: Insurers file multiple scenarios for 2018 ACA premium rates due to uncertainty over CSRs, individual mandate]

"As a result, CMS intends to propose a modification to the HHS risk adjustment methodology in future rulemaking for states in which all marketplace issuers increase silver metal plan rates to account for cost-sharing reduction payments in this manner," CMS said in the August 10 notice.

Current HHS plan liability for cost-sharing variations reflect an actuarial value of 70 percent. CMS proposes an adjustment to the methodology to reflect the assumption of greater plan liability in states that have allowed a rate change.

To give insurers time to account for the rating changes, CMS is extending the 2018 filing deadline to Tuesday, Sept. 5.

States and CMS will review the rate filings and have a final posting on November 1, the day open enrollment begins for 2018.

[Also: Lack of CSRs one reason Anthem BCBS to leave ACA market in Ohio]

The Congressional Budget Office this week is expected to release an analysis of the effect of discontinuing the payments to insurers.

The payments are currently being released on a month-to-month basis, with insurers asking for a guarantee of their continuing to avoid a rate hike or an exit from the ACA 2018 market.

Without CSRs, insurers would need to increase their premiums for silver plans by an estimated 19 percent, according to a recent Kaiser Family Foundation report.

Twitter: @SusanJMorse

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