Reinsurance fee rules would exempt certain self-funded group health plans
By: Matt Dunning (Business Insurance) November 2013
Proposed rules issued this week would provide certain self-funded group health care plans with relief from the financial burden of one aspect of the health care reform law.
Employers that self-insure and self-administer health coverage for their employees will be exempt from having to pay into reform law’s three-year Transitional Reinsurance Program for the 2015 and 2016 plan years, the Department of Health and Human Services said in rules proposed Monday.
However, all self-insured plan sponsors — as well as fully-insured employers — will be required to pay into the reinsurance program in 2014.
The reinsurance program was designed to generate $25 billion over three years to offset insurers’ added costs as thousands of high-risk individuals purchase health coverage through public exchanges authorized under the Patient Protection and Affordable Care Act.
In March, HHS set employers’ 2014 contribution rate for the reinsurance program at $63 per plan participant.
Under the rules proposed Monday, the 2015 contribution rate would be $44 per plan participant for fully-insured employers and self-insured employers that use third-party administrators.
HHS said it decided against imposing the fee on self-insured, self-administered group health plans in 2015 and 2016 because they do not rely on outside commercial entities “for administration of the core health insurance functions of claims processing and plan enrollment.”
Self-funded plans that use third-party administrators or other external entities only for ancillary support also are exempt from paying the reinsurance fee in 2015 and 2016.
