“Health Insurance Premium Tax Credit” (IRS REG-131491-10)

NIHB Analysis of Proposed Rule: Health InsurancePremium Tax Credit (IRS REG-131491-10)As referenced in the NIHB comments on the Exchange Establishment proposedrule, 33 NIHB is concerned that the “benchmark plan” defined in the Proposed Rule may notbe for a qualified health plan (QHP) in the individual market through an Exchange that isactually available to the enrollee (i.e., taxpayer). This issue is significant as the applicablebenchmark premium will be used for purposes of determining the level of premiumassistance that will be provided to eligible Exchange enrollees, if any. The amount of thepremium tax credit is calculated pursuant to § 1.36B-3(d) of the Proposed Rule.The term “applicable second lowest cost silver plan” is defined at IRC § 36B(b)(3)(B).The term is defined as –(B) APPLICABLE SECOND LOWEST COST SILVER PLAN.—The applicable second lowest cost silver plan with respect to anyapplicable taxpayer is the second lowest cost silver plan of theindividual market in the rating area in which the taxpayer resideswhich—(i) is offered through the same Exchange through which thequalified health plans taken into account under paragraph(2)(A) were offered, and(ii) provides—(I) self-only . . .. . .(II) family coverage in the case of any otherapplicable taxpayer.. . .In the Proposed Rule, at § 1.36B-3(f), the term “applicable benchmark plan” issimilarly defined as –[T]he second lowest cost silver plan (as described [in the ACA])offered at the time a taxpayer or family member enrolls in aqualified health plan through the Exchange in the rating areawhere the taxpayer resides [for either single or family coverage]...Both the statutory and regulatory definitions use the phrasing “in the rating area where thetaxpayer resides.”In the ACA, the term “rating area” is not defined. Under § 1.36B-1(n) of thisProposed Rule, “rating area” is defined as—33NIHB Analysis and Comments on CMS-9989-P, ―Establishment of Exchanges and Qualified HealthPlans Implemented Consistent with Title I of the Patient Protection and Affordable Care Act,‖ October 31,2011.National Indian Health Board Page 14 of 23 October 31, 2011