Insurers will pay 3.5% user fee to sell plans on exchanges


Since health insurance exchanges, which are the cornerstone of the reform law, are estimated to cost millions of dollars to operate, the U.S. Department of Health & Human Services has decided to pass a portion of those administrative costs onto insurers.

All insurers will be charged monthly "user fees" if they want to sell plans on the federal-run exchange, which could be operating in multiple states next year, according to a new proposed rule HHS issued Friday.

Starting in 2014, insurers will pay 3.5 percent of the total premiums received through plans they sell on the federal exchange, The Washington Post's Wonkblog reported. But HHS said it might increase that fee in the future, depending on how many people enroll to receive coverage through exchanges.

HHS Secretary Kathleen Sebelius said the user fees should be "sufficient to cover the majority of costs related to the operation of federally facilitated exchanges," but she didn't address how the agency would cover the rest of the costs, reported The New York Times.                                        

However, America's Health Insurance Plans predicted that insurers will pass the new user fees onto consumers, according to The Hill's Healthwatch. "Any new fees to pay for the administration of exchanges will add to the cost of coverage," AHIP Spokesman Robert Zirkelbach said.

To learn more:
- here's the HHS proposed rule (.pdf)
- read the New York Times article
- see The Hill's Healthwatch article
- check out the Washington Post's Wonkblog article

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