Risk Corridors (RC) FAQ
Guidance for FAQ regarding Calculations and Administrative Costs and Allowable Claims Costs
Program Area: Risk Corridors (RC)
Question: If there are administrative expenses or taxes and fees that relate specifically to a QHP, do those expenses have to be allocated proportionally across all non-grandfathered plans? Or can we take those direct expenses straight to the QHP risk corridor calculation without allocating to other plans?
Answer: The treatment of administrative expenses and taxes and fees (including Exchange user fees) should conform to the market-wide calculation for allowable costs and premiums. In this way, allowable claims costs and allowable administrative costs will be pooled for all of an issuer's non-grandfathered, ACA compliant plans, and will be allocated proportionally to an issuer's QHPs, based on the QHP's premium.
Issued by: Centers for Medicare & Medicaid Services (CMS)
Issue Date: May 28, 2014
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