The Transitional Reinsurance Program Continues into its Second Year

Starting in 2014 and continuing into 2016, Section 1341 of the Affordable Care Act set up a Transitional Reinsurance Program that aims to help stabilize premiums in the individual market during this three-year period. To accomplish this, the program requires that certain health insurance issuers and self-insured group heath plans make contributions to cover the expense of high-cost individuals enrolled in non-grandfathered individual market plans. These contributions are also used to pay for the administrative costs of operating the reinsurance program and the General Fund of the U.S. Treasury for these three benefit years.

The cost to each contributing entity for the 2015 benefit year is $44.00 per covered life. While there are multiple methods of calculating your total number of covered lives, BPA utilizes the Snapshot Count and Snapshot Factor methods. With Snapshot Count, we count your total number of covered lives on a single day in each quarter (or more than one day) and then divide the total by the number of dates on which the count was made. With Snapshot Factor, we total the number of participants with self-only coverage on a single day in each quarter, add in the total number of participants with other than self-only coverage on three dates during the same time frames (multiplying this total by 2.35), and divide the sum of those two totals by three (the number of dates on which the count was made). Once determined, your total number of covered lives for 2015 must be submitted to Pay.gov by November 16, 2015. After the submission of your 2015 annual enrollment count, HHS will notify you of your reinsurance fee due; payment must made within 30 days of this notification.

Paying this contribution is done through Pay.gov, with two payment options available to you:

1) One payment for the entire 2015 benefit year no later than January 15, 2016, reflecting $44.00/covered life, OR

2) Two payments for the 2015 benefit year, with the first payment due by January 15, 2016, reflecting $33.00/covered life, and the second payment due by November 15, 2016, reflecting $11.00/covered life.

Although this entire process may seem time consuming, BPA can handle most of it for you. We can help you determine your contribution owed and then submit the payment on your behalf. (Note: BPA will only submit full payments on your behalf, and the full amount must be paid to BPA within 10 days of BPA notifying you of your amount due.) To begin the process, contact Tim Bauer at tbauer@bpaco.com or (715) 836-8208 no later than November 1, 2015.

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