CMS provides update on reinsurance collections, sets 2016 rate filing date
The Centers for Medicare & Medicaid Services (CMS) made statements this week about the Affordable Care Act's reinsurance program as well as rate-filing requirements for 2016 plan year. Here's a quick look at how both announcements will impact health insurers.
Reinsurance collections fall short
CMS reported that the Department of Health and Human Services (HHS) collected nearly $8.7 billion in reinsurance contributions for the 2014 benefit year as of March 31. Nearly $1 billion is scheduled for remittance on or before Nov. 15, which is consistent with the $1 billion estimate for risk adjustment, reinsurance and risk corridor payments that Citigroup made last year.
Per ACA guidelines, the 2014 benefit year collection target is more than $12 billion, with an estimated $10 billion for reinsurance payments, $2 billion for the Department of Treasury fund and $20 million for administrative costs.
CMS did not specify what caused the collections to fall short, reported the Health Affairs Blog. The agency did note that the $63 per covered life amount that HHS collected from insurers, based on its estimate of what's needed to cover the $12 billion target, was too small. Additionally, some contributing entities failed to pay the amount they owed, noted the blog post.
Rates for 2016 due May 15
CMS issued its Insurance Standards Bulletins for single risk pool compliant coverage effective on or after Jan 1., 2016. Insurers offering non-grandfathered, qualified- and non-qualified health plans must submit their proposed rate filing justifications to both CMS and states by May 15. This could prove problematic, FierceHealthPayer previously reported, as insurers won't know until June how the King v. Burwell ruling on tax subsidies for plans sold on Healthcare.gov may affect their 2016 rates.
Under the final rule for rate increases--which was published Feb. 27 in the Federal Register--states must make such rate increases readily available on their websites no later than the first day of the annual open enrollment period for the individual market. Should states choose to release this information earlier, they must notify CMS at least 30 days before making the information public. States also much provide access rate information to the CMS website.
Will insurers take a bath on risk corridors?
Highmark Health blames risk corridor program for operating loss
HHS could pay out $1B to insurers for reinsurance, risk corridor, risk adjustment
How King v. Burwell could impact insurers' rate filings