Only self-insured plans that completely self-administer claims payments and plan operations will avoid paying onerous transitional reinsurance fees. If a self-insured health plan does no more than determine eligibility, it will have to pay, according to Jeffrey Endick, an attorney with Slevin & Hart in Washington D.C.
An exception exists to the onerous fee $63 per-member-per-year fee: Self-insured plans that virtually completely self-administer claims payments and plan operations are exempt from paying it. But it appears few will qualify.
According to Endick, self-insured plans will lose the exemption if the plan uses a TPA for even one of four core claim-paying and adjudication functions. These include: (1) repricing claims; (2) sending out explanations of benefits; (3) cutting checks for providers; and (4) negotiating provider discounts.
Nov. 15 is the deadline for submitting information and scheduling payments for the fee. The payments are not due on Nov. 15, but employers must upload their information by that date.
In accord with that deadline, the Centers for Medicare and Medicaid Services published a 64-page manual to help insurers, third-party administrators and employers fill out their submissions. A separate set of instructions tells employers how to facilitate creation of the data to be submitted. CMS told the public that submission forms will be available on www.pay.gov for program enrollment and contributions data on Oct. 24.
The transitional fee must be paid by all health plans in order to help insurers pay for the high-cost individuals that they must cover because of health care reform’s guaranteed-issue and no-rescission rules. All health insurers and third-party administrators on behalf of self-insured group health plans must pay into the fund.
“Reporting entities” will register on www.pay.gov on or before Nov 15, 2014 for the 2014 benefit year’s annual enrollment, CMS said.
Employers may split the transitional reinsurance fee into two parts: they may submit an initial payment of $52.50 per covered life by Jan. 15, 2015 and a second payment of $10.50 per covered life by Nov. 15, 2015. They may also pay the entire $63.00 per covered life on or before Jan. 15, 2015.
The TR payment for 2015 becomes $44; and insurers and plans can make an initial payment of $33 in and subsequent payment of $11. The amount of the 2016 fee has not been made public yet.