Maryland Health Benefit Exchange outlines budget including reinsurance and young adult subsidies

In a recent session of the Maryland Health and Human Services Committee, key discussions centered around the state’s health insurance budget and the ongoing impact of various programs aimed at improving access to healthcare. The meeting, held on February 27, 2025, highlighted significant financial allocations and program developments that could shape the future of health coverage in Maryland.

At the heart of the budget discussion was the reinsurance program, which has been a critical component since its establishment in 2018. A staggering 83% of the budget is earmarked for reinsurance payments, with an additional 4% dedicated to the young adult subsidy program. The reinsurance program aims to mitigate rising health insurance premiums, and while costs have increased—projecting a $30 million rise in payments—premiums for individuals remain significantly lower than before the program's implementation in 2019.

The Maryland Health Benefit Exchange (MHBE) reported that the individual market rates continue to climb for the 2025 plan year, yet the overall growth in premium costs has decreased since the program began. This is a positive sign for consumers, as it indicates that the reinsurance program is effectively stabilizing the market. However, the committee noted that the costs of the reinsurance program are expected to exceed federal funding, necessitating the use of provider assessment funds to maintain program solvency through 2028.

Another focal point of the meeting was the young adult subsidy program, which has shown promising results in increasing enrollment among young adults and reducing the uninsured rate in this demographic. The program, initially set to expire at the end of 2023, has been extended through 2025, with $26 million allocated for its continuation. However, the committee recommended that $13 million of this funding be contingent upon future legislation to extend the program into 2026.

The session also marked a significant milestone for Deferred Action for Childhood Arrivals (DACA) recipients, as 249 individuals enrolled in state health insurance plans for the first time in 2025. This inclusion reflects a broader commitment to expanding access to healthcare for all Marylanders.

In addition to these discussions, the committee reviewed findings from a recent legislative audit of the MHBE, which identified several areas for improvement, particularly concerning Medicaid eligibility. The audit's recommendations aim to enhance the efficiency and effectiveness of the health exchange's operations.

As the meeting concluded, the Executive Director of the MHBE, Michelle Eberly, expressed gratitude for the committee's support and emphasized the importance of the health exchange in providing services to one in five Marylanders. With ongoing adjustments to funding and program structures, the future of healthcare in Maryland remains a dynamic and evolving landscape, poised to adapt to the needs of its residents.