Cost sharing reduction (CSR) - Glossary (2024)

FAQs

What does a 73% cost-sharing reduction mean? ›

A 73% cost sharing reduction means that your insurance company will pay an average of 73% of your health care costs while you'll pay the remaining 27%. This is a better deal than a regular Silver plan where you'll pay 30% of your medical costs.

cost-sharing reductions. A discount that lowers the amount you have to pay for deductibles, copayments, and coinsurance. In the Health Insurance Marketplace®, cost-sharing reductions are often called “extra savings.” If you qualify, you must enroll in a plan in the Silver category to get the extra savings.

Cost-sharing reductions are available to eligible enrollees who select Silver plans in the marketplace and have household incomes up to 250% of the federal poverty level (FPL).

Somewhat less generous cost sharing reductions are available for people with income between 150 and 200 percent FPL. These reduce cost sharing under silver plans to 87 percent actuarial value (CSR 87 plans). In 2023, the average annual deductible under a CSR 87 silver plan was about $800.

100% coinsurance: You're responsible for the entire bill. 0% coinsurance: You aren't responsible for any part of the bill — your insurance company will pay the entire claim.

Increasing cost-sharing is a blunt instrument: although it may reduce utilization of care that is not medically necessary, it may also result in individuals forgoing necessary care that may prevent healthcare complications down the line.

Cost share or "matching" refers to the resources a recipient contributes to the total cost of an agreement. It becomes a condition of an award when it is part of the approved award budget. It is verifiable from the recipient's records, ie it CAN be audited.

The Silver 73 covers 73% of your out-of-pocket costs, 3% more than the standard Silver Plan. However, if you qualify for a Silver 87 or a Silver 94, you will receive 87% or 94% coverage, which is 17% or 24% more of your out-of-pocket costs than the standard Silver Plan.

qualifies based on their household income, they must enroll in a plan in the Silver category to get these extra savings. ▪ Typically, individuals and families with household incomes up to 250 percent of the FPL may be eligible to receive CSRs.

What is an example of cost sharing? ›

Cost sharing example

You don't use your insurance much, so you haven't contributed to your deductible or out-of-pocket maximum yet this year. In this scenario, you'll be responsible for an initial $2,500 to cover your deductible. After that, you'll pay 20% of the remaining bill, up until you've spent a total of $4,500.

A common problem with cost-sharing programs is that they are too complex to be easily understood by the average insured individual [6, 10]. The level of complexity makes it often difficult to determine the amount of expenses in advance and may preclude well-informed decisions.

CSRs are not reconciled on a consumer's tax return like premium tax credits.

CSR will only conduct business by lawful and ethical means, no matter how fierce the competition, or how high the stakes may seem to employees. Legal responsibilities change and employees at all levels must keep themselves informed and comply with all legal responsibilities.

A19. If you enroll in an employer-sponsored plan, including retiree coverage, that is minimum essential coverage you are not eligible for the Premium Tax Credit for your Marketplace coverage, even if the employer plan is unaffordable or fails to provide minimum value.

Cost-sharing reduces premiums (because it saves your health insurance company money) in two ways. First, since you're sharing the cost of the claim with your insurance company, they pay less. Second, since you have to pay part of the bill, it's more likely you'll only seek medical care when you really need it.

The share of costs covered by your insurance that you pay out of your own pocket. This term generally includes deductibles, coinsurance, and copayments, or similar charges, but it doesn't include premiums, balance billing amounts for non-network providers, or the cost of non-covered services.

Cost sharing is the part of your health care expenses that you will pay for. Cost sharing comes in the form of co-insurance, co-pays, and deductibles. When you buy individual/family coverage, you can choose your level of cost sharing. If your employer offers coverage, it may choose the level of cost sharing for you.

Costs are shared when more than one party pays towards the total costs, or accounted for separately across a number of activities or projects. In health care, cost sharing occurs when patients pay for a portion of health care costs not covered by health insurance.