Proposed ACA Regulations on Transitional Reinsurance Program Premiums and Potential Effects for Employer-Sponsored Group Health Plans

By on December 31, 2012

by Amy M. Gordon, Jacob Mattinson and Susan M. Nash

As part of the Patient Protection and Affordable Care Act (ACA), the U.S. Department of Health and Human Services (HHS) recently released proposed regulations regarding the estimated amount of annual contributions that are required to be paid to HHS from employer-sponsored group health plans to finance state transitional reinsurance programs.  The reinsurance programs are intended to help stabilize premiums for coverage in the individual market during the first three years the state health insurance exchanges are operational (2014 through 2016).  HHS is estimating the annual contribution rate for 2014 will be $63 per covered life (employees and their dependents).  This will undoubtedly impact the overall cost of providing coverage under an employer-sponsored group health plan and should be taken into account by employers for purposes of estimating cost trends.

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