Issued by: Centers for Medicare & Medicaid Services (CMS)

Issue Date: January 30, 2019

Program Area: CSR Reconciliation (CSR)

Question: When using the Simplified Actuarial Value (AV) method, should we pro-rate the annual limitation of cost sharing for members who are not active for the full plan year? For example, if a member is only active for 8 months should we multiply the out of pocket maximum by 8/12ths?

Answer: Issuers must use the actual annual limitation on cost sharing for the plan in the equation for the AV methodology, regardless of whether a member is enrolled for less than the full benefit year.

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