Enrollment Counts for Transitional Reinsurance Fee Due Nov. 15 2016

Enrollment Counts for Transitional Reinsurance Fee Due Nov. 15 2016

Employers with self-insured major medical plans are reminded to report their membership count to the U.S. Department of Health and Human Services (“HHS”) via the pay.gov website by November 15, 2016, as part of the Affordable Care Act’s (“ACA”) transitional reinsurance fee (the “Fee”).
The Fee is assessed on both insured and self-insured group health plans, and applies on a calendar year basis from 2014-2016. Carriers offering group health insurance and sponsors of self-insured medical plans are required to pay the Fee to support payments to carriers in the individual market that cover high-cost claimants.  Carriers pay the fee on behalf of fully insured plans; employers are responsible for paying the fee for a self-insured plan.  Below is a brief summary of key dates and information for employers:

  • October 3, 2016:   2016 ACA Transitional Reinsurance Program Annual Enrollment and Contributions Submission Form should be available on www.Pay.gov.

o When the Form becomes available, a notice will be sent to REGTAP registrants.
o Employers may visit https://www.REGTAP.info to register.

  • November 15, 2016:   Deadline for employers with self-insured plans to report their annual enrollment of covered lives to HHS via the pay.gov website.
  • January 17, 2017:   Payment deadline if making a single payment ($27 per covered life).

o $21.60 per covered life if making a two-part payment.

  • November 15, 2017:   Payment deadline for second payment for employers making a two-part payment ($5.40 per covered life).


  • The Fee applies to major medical coverage.

o It does not apply to stand-alone dental and vision plans, prescription drug-only plans, HRAs, HSAs, FSAs, employee assistance programs (EAPs) and wellness plans that do not provide major medical coverage, post-65 retiree medical coverage, and plans that do not provide coverage that is “minimum value”.
o For 2015 and 2016, plans that are both self-insured and self-administered are exempt from the fee (i.e., the plan cannot use a third party administrator (TPA) in connection with claims processing or adjudication, including managing appeals, or for plan enrollment).

  • Employers are responsible for paying the fee for their self-insured medical plans.

o TPAs may, but are not required to, complete the reinsurance contribution process, including payment, on behalf of a self-insured plan.

  • Various counting methodologies are available.

o Examples of Permitted Counting Methods – From 2015: https://www.cms.gov/CCIIO/Programs-and-Initiatives/Premium-Stabilization-Programs/The-Transitional-Reinsurance-Program/Downloads/The-Transitional-Reinsurance-Program-Operational-Guidance-Examples-of-Counting-Methods-for-Contributing-Entities.pdf.

  • When paying the Fee, employers may need to contact their bank to add Agency Location Code (ALC+2 value) 7505008016 to its list of approved companies for ACH automatic debits.

o The fee is $27 per covered life in 2016, down from $44 per covered life in 2015.

  • When a plan changes from fully insured to self-insured (or vice-versa) during the calendar year, the carrier is responsible for paying the Fee for the portion of the calendar year during which the plan is fully insured, and the employer is responsible for paying the Fee for the portion of the year during which the plan is self-insured.

o Guidance for plans becoming self-insured mid-year: https://www.regtap.info/faq_viewu.php?id=6438 (free registration is required).
MBWL Take-Away:   Employers sponsoring self-insured plans should work closely with their benefits broker to select the most advantageous counting methodology.  The counting methods can be complex and results may vary significantly based on the chosen method.  Once the enrollment form has been submitted and the Fee paid, an employer cannot later amend that filing if it is discovered that another counting method would have been more advantageous.  2016 is the last year for which the Fee will be assessed.

About the authors. This alert was prepared for LassiterWare by Stacy Barrow and Mitch Geiger. Mr. Barrow and Mr. Geiger are employee benefits attorneys with Marathas Barrow Weatherhead Lent LLP, a premier employee benefits, executive compensation and employment law firm. They can be reached at sbarrow@marbarlaw.com or mgeiger@marbarlaw.com.

The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients. This is not legal advice.  No client-lawyer relationship between you and our lawyers is or may be created by your use of this information.  Rather, the content is intended as a general overview of the subject matter covered.  This agency and Marathas Barrow Weatherhead Lent LLP are not obligated to provide updates on the information presented herein.  Those reading this alert are encouraged to seek direct counsel on legal questions.

© 2016 Marathas Barrow Weatherhead Lent LLP. All Rights Reserved.


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