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Reinsurance Reporting from Self-Funded Employers Due Nov 15, 2016

Employers who offered a self-funded plan at anytime from Jan-Sep 2016 are required to submit their reinsurance reporting to HHS via pay.gov by Tue, Nov 15.

The Transitional Reinsurance Program was established by ACA to stabilize premiums in the individual market during the first three years of ACA’s market reforms (2014-16). The program collects fees from group health insurers and self-funded group health plans to reinsure high cost claimants covered by individual health plans. This year (2016) is the program’s final year. No fees or reporting in 2017. This reporting and fee requirement does not apply to employers who only offered fully insured plans (the insurers report and pay those fees).

Applies To: Employers who offered a self-funded major medical plan at anytime from Jan-Sep 2016. Does not apply to employers whose plans do not provide Minimum Value.
Fee Amount: $27 per covered member (see counting methods below to help determine your enrollment count)
Reporting Deadline: Tue, Nov 15, 2016
Fee Payment Deadline[s]: Tue, Jan 17, 2017 (first or combined installment)
Wed, Nov 15, 2017 (optional second installment)
Where to Report: Using the 2016 Reinsurance Form on Pay.gov
Important Notes: Login or register your account. ACH is the only payment method accepted. Follow the instructions to prevent your bank from blocking the debit transaction. Payments are scheduled using the form.
More Information: CMS 2016 Reinsurance Resource Page
Or email questions to reinsurancecontributions@cms.hhs.gov

Counting Methods

Employers have the option to use any of the four counting methods. The Snapshot Count method is the easiest and most popular method. The intent of the counting methods is to determine the average number of members (belly buttons) covered by the plan during the first nine months of the year. Employers who did not offer a self-funded plan for all nine months should adapt the method to determine the appropriate count. Employers cannot use the technical guidelines to intentionally misrepresent their average enrollment.

  1. Actual Count – Add total number of members covered for each day of the first nine months (Jan-Sep) and divide by the number of days in those months.
  2. Snapshot Count – Add the number of members covered on a corresponding day or days in each quarter and divide by the number of dates used. Dates used must fall within same week of each quarter. Employers who did not offer self-funded coverage for all nine months should use one day from each month including months that no coverage was offered and divide by nine.
  3. Snapshot Factor – Use if only the actual number of enrolled subscribers (employees) is known and the number of covered family members is not available. The guidelines are the same as the Snapshot Count method except employers use a factor of 2.35 for subscribers with family coverage. Add the number of participants with self-only (EO) coverage and the number of participants with coverage other than self-only (e.g.: ES, EC, EF) times 2.35 on corresponding days in each quarter and divide by the number of dates used.
  4. Form 5500 Method – Only available to employers who filed a Form 5500 for the most recent benefit year (generally employers with 100+ participants). Add the number of participants covered at the beginning and the number covered at the end of the plan year as reported on the Form 5500. No division here. Just addition.

Other Important Notes

Employers who need to correct their submission can simply re-submit their reporting using the same form if the correction is made within 30 days of the original filing and no payments have been made.

Employers who missed the reporting deadline should attempt to use the pay.gov form and/or email reinsurancecontributions@cms.hhs.gov. Late penalties may apply.

Most TPAs/carriers who administer self-funded, level funded, etc plans will agree to administer the reporting on an employer’s behalf. Employers must agree to the service (via a written agreement) and/or actively instruct the administrator to do it. Administrators will not provide the service without the employer’s specific knowledge. Do not assume someone else is handling it unless you know they are!

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