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Reinsurance program and state exchange brace for federal changes that could shrink marketplace enrollment
Summary
Bureau of Insurance and the Virginia Health Benefit Exchange told the subcommittee the Commonwealth Health Reinsurance Program has lowered premiums but federal changes — notably the likely expiration of expanded premium tax credits — could reduce federal pass-through funding, raise state costs and cause substantial marketplace enrollment losses.
Brad Marsh of the Bureau of Insurance and Director Bob Padgett of the Virginia Health Benefit Exchange briefed the Joint Subcommittee for Health and Human Resources Oversight on the Commonwealth Health Reinsurance Program (CHRP) and marketplace developments.
Marsh explained CHRP is a Section 1332 state innovation waiver program that reimburses carriers for a portion of very high-cost claims to lower premiums in the individual market. The waiver is currently approved through benefit year 2027. The program uses federal pass-through funds (derived from savings to premium tax credit payments) and state general funds to reimburse carriers; unused federal pass-through funds may be carried forward.
For benefit-year design, the bureau set parameters targeting a roughly 15% premium reduction (the statute permits up to 20%). Marsh warned that the value and federal share of CHRP depend on the Advanced Premium Tax Credit (APTC) structure: if enhanced APTCs expire as…
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