(1) This section applies to all individual silver level plans offered on the health benefit exchange for plan years beginning on or after January 1, 2027.
(2) The following assumptions will be used by the commissioner in the cost-sharing reduction (CSR) silver load calculation:
(a) Actuarial values are based on federal risk transfer formula factors published by the United States Centers for Medicare and Medicaid Services.
(b) The actuarial value for limited cost-share silver variant is 70 percent based on qualified health plan application instructions.
(c) Induced demand factors are based on federal risk transfer formula factors published by the United States Centers for Medicare and Medicaid Services.
(d) Membership distribution and enrollment assumptions are based on the prior year experience provided by the health benefit exchange and include appropriate adjustments for health benefit exchange plan mapping procedures.
(3) The methodology and formula used by the commissioner to calculate the CSR silver loading factor is as follows:
(a) For each exchange silver plan variant, compute the enrollment-weighted product of the plan's actuarial value and the induced demand factor.
(b) Sum the results of step (a) of this subsection.
(c) Divide the result of step (b) of this subsection by the product of the actuarial value and induced demand factor for the base silver plan (values for the 70 percent AV metal level plan).
(d) The result in step (c) of this subsection is the final CSR silver load factor for the plan, which applies only to exchange silver plans. The result must be incorporated into premium rate development as a component of the "actuarial value and cost-sharing design of the plan" adjustment, provided the issuer does not otherwise receive reimbursement for cost-sharing reduction amounts.
(4) Based on the calculation in subsection (3) of this section and the assumptions in subsection (2) of this section, the commissioner may update the final cost-sharing reduction silver loading factor annually, as the commissioner determines appropriate.
(5) The commissioner will provide the final cost-sharing reduction silver loading factor and plan-mapping assumptions used in the commissioner's calculation to issuers by March 31st of each year.
(6) For any plan year during which all issuers receive reimbursement for cost-sharing reduction expenses from the federal government, the commissioner will forego calculating a silver loading factor.