As implementation of the Affordable Care Act (ACA) moves forward, companies are seeking to understand how it will affect their business. Recently, attention has been given to the financial impact from risk-spreading programs within ACA.
The transitional reinsurance program is intended to help stabilize premiums for coverage in the individual market from 2014 through 2016. This is the time period when individuals with higher-cost medical needs gain insurance coverage. But the bottom-line is this: this program will impose a fee on health insurance issuers and self-insured group health plans.
Important Items to Know
Recently, the Department of Health and Human Services (HHS) proposed regulations that clarify how these fees will work. Here’s a brief overview:
- For self-insured group health plans, the plan sponsor is liable for paying the reinsurance fees (a TPA or ASO contractor may be used to make the payment)
- The amount of the fee is proposed to be $63 per covered life per year
- The rate will be announced each year by HHS
Free White Paper to Help Your Business
There are certainly many other components to these programs that employers may have questions on. If you find yourself in that position, we are happy to say that CBG Benefits is here to help.
We have released an in-depth White Paper entitled “Proposed Reinsurance Fees Will Cost Group Health Plans”.
This White Paper answers a variety of questions, including:
- Who must pay the fees?
- What types of coverage are excluded?
- How will fees be determined and collected?