NEWS ALERT: CMS Issues New Policy Allowing for Premium Reductions for 2020 Coverage

The new policy is to remain in effect through 2020.

The Centers for Medicare & Medicaid Services (CMS) has unveiled a new policy allowing issuers to offer temporary premium reductions for beneficiaries with 2020 coverage in individual and small-group markets, officials announced Tuesday.

The “additional flexibility” should allow consumers struggling to pay premiums to retain their coverage and maintain access to care, CMS said.

“Throughout the COVID-19 pandemic, the Trump Administration has taken a whole-of-America approach, including working with our private partners, to ensure that the entire healthcare system is activated in our efforts to protect the American people,” CMS Administrator Seema Verma said in a statement. “Today’s action is just the latest in a series of flexibilities CMS has extended to health insurers to help them support their enrollees during this unprecedented time.”

In exercising what it described as “enforcement discretion,” CMS said it would allow issuers, when consistent with state laws, to offer premium reductions for one or more months of 2020 coverage, with the policy to remain in effect through the end of the calendar year. Issuers are generally prohibited under federal requirements from changing premiums for health insurance coverage offered in individual and small-group markets after the start of the benefit year.

“Today’s announcement follows CMS’s adoption of several relaxed enforcement policies providing issuers the flexibility they needed to assist their enrollees impacted by the ongoing public health emergency,” the agency said in a press release. “Under one of the enforcement policies CMS adopted, issuers that offer coverage through HealthCare.gov were permitted to extend premium payment deadlines and delay cancellation for non-payment of premiums. As another example, CMS adopted a non-enforcement policy that permitted issuers to prepay to enrollees a portion or all of the estimated Medical Loss Ratio (MLR) rebate for the 2019 MLR reporting year.”

The COVID-19 pandemic has now reportedly sickened more than 18.5 million people worldwide, killing more than 700,000. The U.S. accounts for approximately a quarter of those figures, despite accounting for only 4 percent of the world’s population.

To review the new guidance in its entirety, go online to https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Marketplaces/Downloads/Premium-Credit-Guidance.pdf