CMS approves Alaska waiver meant to stabilize market
The CMS approved a first-of-its-kind waiver allowing Alaska to use federal money to create a high-risk fund. It will allow the state to continue trying to entice cash-strapped insurance companies to stay on the state’s individual market and not raise premiums.
Under Alaska’s recently approved 1332 waiver, the state could use what would have been federal premium tax credits and cost-sharing reductions to fund a reinsurance program.
The approval will temporarily stabilize Alaska’s individual insurance market, according to CMS Administrator Seema Verma.
Alaska asked for the funding after insurers projected premium hikes of 42% this year. Early this year, states were given the green light to request waivers for virtually every coverage component of the Affordable Care Act as long as the state’s healthcare coverage is consistent with ACA’s terms and doesn’t increase the federal deficit.
The Alaska Reinsurance Program pays claims for individuals with highcost conditions, removing those claims from the insurance risk pool, thus keeping premiums down. State funds were appropriated to fund the program only for 2017.
The CMS believes the waiver will allow more Alaska residents to keep their coverage and see lower premiums. The five-year waiver starts Jan. 1.