Salem — The Oregon Department of Consumer and Business Services (DCBS) announced today that it has received approval of Oregon’s 1332 State Innovation Waiver from the Centers for Medicare and Medicaid Services (CMS). This approval will grant Oregon an estimated $30 million annually to fund the new Oregon Reinsurance Program created during the 2017 Legislative Session.
The Oregon Reinsurance Program is designed to stabilize the individual market, reduce rates, and encourage insurance companies to offer plans in more parts of the state. Reinsurance spreads the risk of high-cost claims so that all insurance companies take an equal share of the risk of expensive claims.
Rates for individual plans in 2018 have already been reduced by 6 percent from what they would have been without the reinsurance program.
“We are pleased that CMS has quickly approved Oregon’s 1332 State Innovation Waiver application enabling Oregon to establish its reinsurance program,” said Acting DCBS Director Jean Straight. “The Oregon Reinsurance Program will provide much needed stability to Oregonians who purchase insurance on their own. Without this program, we might be seeing counties with no plans offered through Oregon’s Health Insurance Marketplace, and much larger rate increases for those who purchase insurance on their own in 2018.”
Funding for the reinsurance program comes from federal funding through the approved 1332 State Innovation Waiver from CMS, funds from the previous temporary reinsurance program that ended in 2016, the Oregon Health Insurance Marketplace assessment account, and an assessment approved by the Legislature during the 2017 session. The total expected funding for plan year 2018 is approximately $90 million.
In the coming months, DCBS will create create operating parameters and guidelines for the reinsurance program through an open and transparent administrative rulemaking process. For more information about this process as it become available, visit dfr.oregon.gov.
The Department of Consumer and Business Services is Oregon’s largest business regulatory and consumer protection agency. For more information, visit www.dcbs.oregon.gov.