The Patient Protection and Affordable Care Act (ACA) established the transitional reinsurance program to stabilize premiums in the individual market place by reducing the costs of high-risk enrollees. The program requires health insurance issuers and certain self-insured group health plans offering major medical coverage to make contributions under the program for 2014 through 2016. The fee is $63 per covered life in 2014 and will decrease in 2015 and 2016.
For purposes of the reinsurance fee, “major medical coverage,” as defined under 45 CFR 153.20, means a catastrophic plan, an individual or group market plan, or health coverage for a broad range of services and treatments provided in various settings that provides minimum value. The fee is generally not applicable to health reimbursement arrangements that are integrated with major medical coverage, health savings accounts, health care flexible spending accounts, employee assistance programs that do not provide major medical coverage, stop-loss coverage and plans providing stand-alone prescription drug, dental or vision coverage.
The 2014 deadline for reporting the number of participants covered under a health plan for purposes of paying the 2014 Transitional Reinsurance Fee has been extended from November 15, 2014 to December 5, 2014. Those subject to the fee must register and report the number of participants covered under their health plans for 2014 at www.pay.gov.
Although the health plan is responsible for the reinsurance fee, it may elect to use a third party administrator or administrative services-only contractor for submission of enrollment data and transfer of the reinsurance contributions. The “ACA Transitional Reinsurance Program Annual Enrollment and Contributions Submission Form” can be accessed on Pay.gov and is used to submit the annual enrollment count and calculate the fee. The fee itself can be paid in one or two installments. If paying in one installment, the 2014 fee is due no later than January 15, 2015. If making two separate payments, the first remittance is due by January 15, 2015 reflecting $52.50 per covered life, and the second remittance is due by November 15, 2015 reflecting $10.50 per covered life.