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An End to 'Silver-Loading'? Question Queued Up for 2021

Analysis  |  By Steven Porter  
   January 18, 2019

Democrats alarmed by elements of the administration's proposed 2020 Payment Notice for ACA marketplace plans.

Federal officials are considering whether to halt "silver-loading," but the potential change won't come this year or next.

In its proposed 2020 payment notice for the Affordable Care Act released Thursday, the Centers for Medicare & Medicaid Services asked for public input on whether and how it should end the controversial pricing tactic for plans on the ACA exchanges for 2021.

Health insurers resorted to silver-loading after the Trump administration ended cost-sharing reduction (CSR) payments in 2017, prompting insurers to hike premiums in 2018. Because the ACA calculates tax credits based on silver plans, many insurers raised prices on these popular middle-tier plans alone. That resulted in bigger tax credits that protected many consumers while costing taxpayers more.

The CMS proposal argues the administration's options have been limited by lawmakers' inaction.

"Silver loading is the result of Congress not appropriating funds to pay CSRs, with the result being an increase to the premiums of benchmark plans used to calculate premium tax credits, and the federal deficit," the proposal states.

"The Administration supports a legislative solution that would appropriate CSR payments and end silver loading," it adds. "In the absence of Congressional action, we seek comment on ways in which [Health and Human Services] might address silver loading, for potential action in future rulemaking applicable not sooner than plan year 2021."

CMS Administrator Seema Verma and HHS Secretary Alex Azar have each said in the past that they worry about silver-loading and will consider blocking it. Democratic state attorneys general who sued the Trump administration over the halted CSR payments had cited silver-loading concerns in their suit, which was dismissed last year.

Andy Slavitt, a former acting CMS administrator during the Obama administration, said halting silver-loading would be just another bullet point in the lengthy list of ways Trump administration officials have sought to sabotage the ACA.

"Getting rid of silver loading is a sure fire path to raising premiums by a lot and pricing people out of health care," Slavitt wrote in a tweet. "Why get rid of it? Because it was created in direct response to Trump trying to shock the market in 2017 by eliminating subsidies and increasing premiums."

Slavitt similarly criticized the proposal's request for information about potentially ending automatic reenrollment, urging the public to comment on the proposal.

Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.


Cost-sharing reduction payments were halted in 2017 after the Trump administration determined it lacked congressional approval for them to continue.

Many insurers hiked premiums in 2018 and 2019 on silver ACA plans alone, resulting in higher federal subsidies.

The controversial pricing tactic won't be banned in 2020, but its future in 2021 remains unclear.

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