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HHS Announces Reinsurance Fee Exemption For Some Self-funded Groups

10/30/13

  05:17:52 pm, by MedBen5   , 269 words,  
Categories: News, Health Plan Management, Health Care Reform

HHS Announces Reinsurance Fee Exemption For Some Self-funded Groups

Coming hot on the heels of President Obama’s health plan promise kerfuffle is a possible break on reinsurance fees… and more proof that it pays to self-fund.

According to BenefitsPro, the Department of Health and Human Services announced earlier this week that certain self-funded groups will be exempted from paying reinsurance fees in 2015 and 2016. The modification followed complaints by employers that the fees – imposed to offset high-cost individuals covered by the new health marketplaces – are burdensome.

At this point, it’s unclear as to which employers will be exempted. Additionally, all self-funded employers will still be required to pay the $63-per-plan-member fee for the program, which begins in 2014.

So why should a fully-insured group consider making the switch to self-funding when a porton of the fee still looms? Because health insurance companies also have to pay the reinsurance fee, and based on the HHS announcement, will not receive any exemption. That means insurers will either have to eat the fee or pass it on through employer premiums – and one guess as to which option most will choose.

With a self-funded plan, an employer has greater flexibility to offset such fees with changes to plan design. And with MedBen serving as your third party administrator, added saving solutions are available through such features as claims cost containment, 100% pharmacy plan discounts and rebates, and worksite wellness services.

Self-funding offers the advantage of less regulatory oversight than fully-insured coverage. But should the government impose added fees, MedBen can help your group minimize their impact. To learn more, contact Vice President of Sales & Marketing Brian Fargus at bfargus@medben.com.

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