Proposed rule changes advanced by the Trump administration would cause a premium increase of approximately 1 percent for purchasers of health insurance under the Affordable Care Act.

According to an Associated Press report, the Centers for Medicare and Medicaid Services said the reason for the change was “to more accurately calculate premium subsidies under the law” and to improve the accuracy of the complex formula that affects premium levels for consumers.

As noted by Modern Healthcare, that the 300-plus page proposed regulation also would reduce the exchange user fee charged to health insurers to fund the health insurance exchanges. According to CMS, that would help lower consumer premiums in 2020.

The exchange user fee would be lowered from 3.5 percent of premiums for qualified health plans on the federal exchange in 2020 to 3 percent; for plans on state-based exchanges, the rate would fall from 3 percent to 2.5 percent.

CMS also intends to cut drug spending by letting individual, small group and large group insurers to change prescription drug formularies in midyear to encourage members to use lower-cost generics. The proposed regulation would allow a generic to be added to the formulary if it becomes available in midyear, as well as to eliminate the brand-name equivalent from the formulary or move it to a different cost-sharing tier. Plan members would have to be provided with at least 60 days' notice of the change.

In addition, CMS seeks to end “silver-loading,” the practice by insurers of loading premium increases into silver-level exchange plans, an action taken after Trump rescinded cost-sharing reduction payments as a means of making up for those missing payments. By adding premium surcharges to silver plans, insurers were able to increase the size of the premium tax credits for people whose incomes were below 400 percent of the federal poverty level.

According to Modern Healthcare, the proposed changes apply to ACA exchange and individual market insurers, in addition to the insurers who participate in the small group, large group and self-funded group health plan markets.

The regulation includes an administration estimate that the government would save approximately $900 million a year on subsidies, and that 100,000 consumers would drop health coverage.

Senator Ron Wyden, D-Oregon, said of the proposed regulation in a statement, “Today's proposed rule deliberately and needlessly increases premiums and will result in too many Americans losing access to health coverage.” Wyden added, “The Trump administration continues to fan the flames of uncertainty while families pick up the check.”

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Proposed ACA tweaks would end silver-loading, reduce exchange fees

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