The Centers for Medicare and Medicaid Services (CMS) announced today that the average premiums for second lowest cost silver plans (SLCSP) available on the Exchanges will drop by 1.5% in 2019. This is the first year-to-year drop in average premiums since the Exchanges became operational in 2014. The data released today includes plans sold on one of the federally-facilitated exchanges and excludes data from states that operate their own Exchange. Approximately 7.5 million of the 11.7 million individuals insured through Exchange plans purchase the plans through a federally-facilitated exchange. Between 2017 and 2018, average SLCSP premiums increased 37%.

Consumers should also expect access to more plan options in 2019: CMS also announced that there will be 23 additional issuers participating for the 2019 plan year and only four states will have one insurer, down from 8 states who only had one insurer in 2018. The stabilization of premiums has come at a fortuitous time: 2019 will be the first year in which the individual mandate will no longer apply, so stable premiums will hopefully encourage people to maintain coverage who might otherwise have dropped it.

Since 2017, the Trump Administration and Congress has taken several actions to alter the markets established for the Exchanges, including ending the cost-sharing reduction reimbursements for low-income individuals, loosening regulations concerning association health plans and short-term health plans, and eliminating the individual mandate starting in 2019.

Conventional wisdom supports the idea that a combination of factors have led to the instability in the individual marketplaces since 2014: initial rates that were too low, either due to actuarial miscalculations or decisions to price premiums competitively by insurers; the decision by many states to not expand Medicaid; the general instability inherent in the individual and small group markets; as well as multiple actions taken by the Trump Administration and Congress in 2017 and 2018. However, it seems that the market may be starting to stabilize and the decision of insurers to re-enter markets that they had previously abandoned is a positive sign.