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ACA reinsurance payments for 2016 are due Nov. 15

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Managers of the Affordable Care Act reinsurance program are hoping health insurers and many self-insured group health plans will send the program $27 per covered life by late 2017.

Related: How to pay your ACA reinsurance bill

The temporary program is supposed to use cash payments from health insurers and health plans to protect issuers of individual major medical coverage against catastrophic claims in 2014, 2015 and 2016.

The Center for Consumer Information and Insurance Oversight, the agency that runs the program, recently published a reinsurance program how-to guide on its website.

Health insurers are supposed to use, a government payment website, to tell the government how many lives they cover, and when they expect to make their ACA reinsurance program contributions, by Nov. 15, according to CCIIO.

An insurer can choose between two payment methods. It can pay all $27 per life through by Jan. 17, 2017, or it can break the payment into two chunks. An insurer that chooses the two-payment option must pay $21.60 per covered life by Jan. 17, 2017, and $5.40 per covered life by Nov. 15, 2017.

The same payment rules apply to self-insured group health plans that use third-party administrators.

The government has exempted some types of plans, including traditional Medicare plans, traditional Medicaid plans, Children’s Health Insurance Program plans, state Basic Health Plan programs, health savings account programs, health reimbursement arrangement programs offered alongside group health plans, military health plans, and plans provided by Indian tribes.

Health insurers can choose from a list of three covered-life counting methods. Self-insured group health plans can choose from a list of four methods.

Drafters of the Patient Protection and Affordable Care Act of 2010, one of the two laws that make up the ACA package, created the reinsurance program to help insurers adjust to tough ACA medical underwriting restrictions.

The program is also supposed send cash to the U.S. Treasury. The ACA calls for the program to send $2 billion in cash to the Treasury for 2014, $2 billion for 2015 and $1 billion for 2016. 

The U.S. Government Accountability Office, a research arm of Congress, recently agreed with Republicans in Congress that the reinsurance program should use any cash it gets from insurers and health plans to pay the Treasury before it pays health insurers’ reinsurance claims.

The program also faces another potential challenge: a change in administration.

Election Day is Nov. 8.

Up till now, the Obama administration has been the only presidential administration involved with designing, implementing and running ACA programs. Officials in a new administration might want to change the way the reinsurance program and other ACA programs work.


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