Transitional Reinsurance Program – HHS Report for the 2014 Benefit Year
The Transitional Reinsurance Program (TRP) was established under PPACA and pays for a corridor of medical claims to help stabilize premiums in the individual health insurance market. A federally mandated reinsurance program, it provides reinsurance to issuers of individual health insurance policies from 2014 to 2016.
Update on the 2014 Benefit Year
On June 17, 2015, the U.S. Department of Health and Human Services (HHS) announced that the coinsurance rate for the 2014 benefit year has been increased from 80% to 100% because reinsurance contributions for 2014 exceeded the requests for reinsurance payments. HHS will remit payments to issuers starting in August 2015.
HHS collected approximately $8.7 billion in reinsurance contributions for 2014 with approximately $1 billion more scheduled to be collected on or before November 15, 2015.
On June 30, 2015, HHS further announced that for the 2014 benefit year, over $7.9 billion in reinsurance payments will be made to 437 issuers nationwide out of the 484 issuers with enrollment in reinsurance-eligible individual market plans. HHS summarizes the TRP reinsurance payments by issuer starting on page 12 of its report “Summary Report on Transitional Reinsurance Payments and Permanent Risk Adjustments Transfers for the 2014 Benefit Year” which can be viewed here (PDF).
TRP Summary Table
The following table summarizes the payment parameters and contribution rates for each of the three years of the TRP.
Key dates relating to the TRP are set out here.
Looking for more details on the Transitional Reinsurance Program? Download our whitepaper Learn the Facts: The PPACA Transitional Reinsurance Program.”