The “Big, Beautiful Bill” is now in the U.S. Senate for review and approval. Today, we want to focus on the impact of two specific changes on what ACA agents will do with clients: cost-sharing reductions (CSRs) and the “silver-loading” effect of Premium Tax Credits.
Another resource on these two subjects is the KFF. KFF provides a detailed history of how we arrived at the current situation and how the bill addresses it through its changes.
A Quick Summary of Where We Are
The current ACA Marketplace has ACA carriers offsetting the costs of CSRs’ low-income clients’ Marketplace plans by increasing monthly premiums on Silver plans, where most of these clients enroll. The result is a higher benchmark premium that the federal government uses to determine the amount of Premium Tax Credit low-income ACA clients may receive.
The federal government is spending more on Premium Tax Credits due to the silver-loading phenomenon, and that amount exceeds what it would have spent if it had paid carriers for the CSRs in the first place.
The Changes in The Big, Beautiful Bill to Address This Issue
The bill reinstates government payments for CSRs to the 2017 level. There’s no prohibition against raising monthly premiums for Silver plans, but the existing regulation removes any need for those higher premiums to remain.
The expectation is that monthly premiums for Silver plans will decrease, reducing the federal government’s costs for Premium Tax Credits through lower premium benchmarks. The government realizes cost savings that can be applied to the deficit.
In the real world, we know that low- to middle-income clients also use Premium Tax Credits to enroll in Bronze and even Gold ACA Marketplace plans. These plans’ premiums aren’t affected by the bill’s change, so the impact on these clients will be a lower tax credit to cover the Bronze or Gold monthly premium.
What We See as an Opportunity for Agents
- CSR payments to carriers should lower monthly premiums for ACA Silver plans in 2026, perhaps by a double-digit decrease. Current regulations make it extremely difficult for carriers to maintain these Silver premiums unless the costs justify them.
- Low- and middle-income clients with Gold and Bronze plans are at risk of disenrolling due to higher net monthly premiums resulting from the bill change.
- Agents should be ready to present Silver plans now, with a projected lower monthly premium, driven by eliminating silver-loading and the premium tax credit, offering even better value on this base at a lower cost.
At this time, Agility cannot confirm whether these provisions will remain in the bill approved by the U.S. Senate or in the final bill passed by both the U.S. House and the U.S. Senate. We will keep you informed of the latest developments on this bill on these pages.
Mike Berglund, our ACA product specialist, is here to help with any questions about these changes and the opportunities they present for agents. Mike can also refer you to our Medicare and Supplement product specialists for any questions you have in these areas.
Contact Mike through Agility Producer Support at (866) 590-9771 or email support@enrollinsurance.com to schedule a meeting or call with Mike or for answers to any insurance questions. Agility can also add you to our free weekly email list for tips and vital information!
