State Health Care Premium Reduction Act of 2021

State Health Care Premium Reduction Act of 2021

This bill establishes and provides funding for the Improve Health Insurance Affordability Fund. States must use allocated funds to (1) issue reinsurance payments to health insurers (i.e., reimbursements to protect insurers against exceedingly high claims) for individual health insurance coverage, or (2) provide other assistance to reduce out-of-pocket costs (e.g., copayments, coinsurance, and deductibles) for qualified health plans offered in the individual market through an exchange.

Reinsurance payments using such funds may not be applied to (1) grandfathered health plans in place on March 23, 2010, (2) non-grandfathered transitional plans meeting specified requirements identified by the Centers for Medicare & Medicaid Services (CMS), or (3) student health insurance plans provided by institutions of higher education.

The bill appropriates $10 billion per year for the fund, which the CMS must distribute to states in accordance with a specified methodology based on the estimated amount of reinsurance payments for individuals in a state during the given year, subject to specified deductions. Additionally, states must submit applications explaining how they will use such funds. In the event that a state does not submit an application, the bill directs the CMS to allocate the calculated funding amount to reinsurance programs in that state.

Bill 117 hr 1878, also known as the State Health Care Premium Reduction Act of 2021, aims to reduce health care premiums for individuals and families across the United States. The bill focuses on providing financial assistance to states in order to lower the cost of health insurance for residents.

One of the key provisions of the bill is the establishment of a grant program that would allocate funds to states to help them implement strategies to reduce health care premiums. These strategies could include expanding access to affordable health insurance options, promoting competition among insurers, and increasing transparency in pricing.

Additionally, the bill includes measures to incentivize states to adopt policies that would lower health care costs, such as implementing reinsurance programs or creating high-risk pools for individuals with pre-existing conditions. These initiatives are aimed at stabilizing the health insurance market and making coverage more affordable for all Americans. Overall, the State Health Care Premium Reduction Act of 2021 seeks to address the rising cost of health care in the United States by providing states with the resources and support needed to lower premiums and increase access to quality, affordable health insurance options for individuals and families.