Issued by: Centers for Medicare & Medicaid Services (CMS)

Issue Date: October 27, 2014

Program Area: Reinsurance-Contributions (RIC)

Question: For employers with multiple health plans, fully insured and self-insured, is the employer responsible for remitting reinsurance contribution payments for the self-insured plans only?

Answer: Applicable to All Reinsurance Contributions Benefit Years: Contributing Entities include health insurance issuers and self-insured group health plans (including group health plans that are partially self-insured and partially insured, where the health insurance coverage does not constitute major medical coverage). Each Contributing Entity is responsible for remitting reinsurance contributions for the covered lives enrolled in a major medical coverage plan; unless an exception in 45 CFR 153.400(a) applies. Special rules govern the procedures for counting covered lives for a plan sponsor maintaining multiple group health plans (including one (1) or more group health plans that provide health insurance coverage,) which simultaneously and collectively provide major medical coverage for the same covered lives. Reference 45 CFR 153.405(g) for additional guidance. In this situation, the general rule is that the plan sponsor must treat the multiple group health plans that include an insured plan as a single group health plan for reinsurance contributions purposes, using one (1) of the counting methods for insured plans at 45 CFR 153.405(d)(1) or (2). However, a plan sponsor is permitted to elect to treat the multiple group health plans as separate group health plans if the plan sponsor determines the number of covered lives under each separate group health plan as if each separate group health plan provided major medical coverage. A plan sponsor is not required to include as part of a single group health plan any group health plan that consists solely of excepted benefits as defined by section 2791(c) of the Public Health Service Act, that only provides benefits related to prescription drugs or that is a health reimbursement arrangement, health savings account, or health flexible spending arrangement. If there are multiple group health plans(including self-insured and fully-insured plans) offered by a plan sponsor that provides major medical coverage for different covered lives, the general procedures for counting covered lives under 45 CFR 153.405(d) and (e) would apply. Therefore, a health insurance issuer is responsible for contributions for the covered lives enrolled in an insured plan that provides major medical coverage, and a self-insured group health plan is responsible for contributions for the covered lives enrolled in a self-insured plan (including a plan that is partially insured and partially self-insured) that provides major medical coverage, unless an exception in 45 CFR 153.400(a) applies. To determine the number of covered lives, the health insurance issuer would use one (1) of the counting methods for insured coverage at 45 CFR 153.405(d) and the self-insured group health plan would use one (1)of the counting methods for self-insured plans at 45 CFR 153.405(e).

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