Health Insurance – Individual Market Stabilization – Extension of Provider Fee
The bill's impact will be seen in the extended time frame for which health insurance providers will be subject to the provider fee. Specifically, it aims to collect a 1% assessment based on each entity's premium tax liability, which is a reduction from 2.75% for the first year in question. This gradual approach allows insurers to adapt financially while still contributing funds aimed at supporting the individual insurance market, thus helping to keep premiums in check.
Senate Bill 395 seeks to stabilize the individual health insurance market in Maryland by extending the assessment of a health insurance provider fee until 2028. This fee is imposed on insurers and various health organizations to support the financial stability of the market, which has been affected by various covid-related disruptions and economic uncertainties. The bill intends to ensure that insurance providers contribute to maintaining a functional marketplace for health coverage, particularly for individuals seeking insurance independently.
While supporters of SB395, including various administrative figures, argue this stability is crucial in retaining accessible health insurance options, there may be concerns from entities opposing increased taxes. Some critics may view the extended fee as a burden on insurance providers, potentially leading to higher premiums for consumers in the long run. It remains a point of discussion how this financial mechanism balances public health funding and market sustainability without pricing out individuals requiring insurance.