What is a cost-sharing reduction (CSR)?

Cost-sharing reductions (CSRs) are designed to help lower out-of-pocket expenses for individuals and families who qualify based on their income when they enroll in a Silver-level health plan through the Health Insurance Marketplace. These out-of-pocket expenses include deductibles, copayments, and coinsurance, making healthcare more affordable for those who might struggle to pay for medical services.

CSRs can significantly decrease the amount that enrollees need to spend when receiving care, thus removing some of the financial barriers to accessing necessary health services. This mechanism aims to improve health equity and ensure that lower-income individuals can afford the care they need without facing overwhelming costs.