US Health Officials Approve Montana Reinsurance Pool

Open enrollment begins in November. The reinsurance program does not apply to the small group market

By Justin Franz

HELENA — U.S. health officials have approved Montana’s plan to create a reinsurance pool that aims to help lower individual health insurance premium costs, state officials said Friday.

The Centers for Medicare and Medicaid Services approved a waiver that authorizes the reinsurance program, Gov. Steve Bullock and State Auditor Matt Rosendale said in separate statements.

A bill passed by state lawmakers this year creates a pool to help reimburse insurers for high-cost claims from $40,000 to $1 million. Because it deals with the Affordable Care Act, federal approval was required before Montana could implement the change.

The reinsurance pool will be funded with money that otherwise would have been used as premium tax credits and through a premium tax on all major medical plans sold in the state.

The three Montana companies that offer health insurance policies on the individual marketplace are proposing reduced rates in 2020, in part because of the reinsurance program. That would reverse several years of premium increases in the individual market.

Blue Cross and Blue Shield of Montana is proposing a 14.1% average premium decrease for the 19,500 people it covers for 2020. PacificSource is proposing a 13.4% decrease for 11,500 people and the Montana Health Co-op is proposing an average 8% premium cut for its 20,700 members.

Rosendale said those rates are expected to be finalized soon.

Open enrollment begins in November. The reinsurance program does not apply to the small group market.

Bullock and the state Department of Administration created a work group to study the issue, and that panel drafted the reinsurance bill for the 2019 Legislature.

“We are taking action for the Montanans who purchase insurance on the individual marketplace and have been burdened by unaffordable health care costs due to federal inaction,” Bullock, a Democrat, said in his statement.

Rosendale supported the measure and earlier efforts to create a reinsurance pool.

“I’d like to thank the Trump Administration for making it a priority to allow states to innovate and create solutions that work best for our citizens,” Rosendale, a Republican, said in his statement.