Employee Benefits Compliance, Reinsurance Fee, Taxes, Fees & Penalties, Transitional Reinsurance Fee

Reinsurance Fee – Schedule 2016 Payment by Nov. 15th


By Tuesday, November 15, 2016, self-insured health plans must schedule payment of the 2016 transitional reinsurance fee.  To do this, the health plan must complete the 2016 ACA Transitional Reinsurance Program Annual Enrollment Contributions Form (which is now available on pay.gov), submit it, and schedule reinsurance contribution payment(s). Although the health plan is responsible for the reinsurance contribution, it may use a TPA or ASO contractor to submit the enrollment data and to transfer the reinsurance contributions.

For the Transitional Reinsurance Program 2016 Benefit Year Information page, click here.

Amount: Payment for 2016 is $27 per enrollee (per “covered life” – which includes employees and dependents). The payment may be made either:

  • in one installment due by January 17, 2017, or
  • in two installments with the first one of $21.60 per enrollee made by January 17, 2017 and the second installment of $5.40 per enrollee by November 15, 2017.

The reinsurance fees amount is calculated based on the plan’s enrollment count during the first nine calendar months of the year, regardless of the plan’s actual plan year. The website calculates the amount due, based on the covered lives count the plan submits, and the plan must then schedule payment of the required amount (in one or two installments, as noted).

What Plans must Pay the Reinsurance Fee?

Group health plans that provide “major medical coverage” (as defined under 45 CFR 153.20) must pay the reinsurance fee, unless one of the exceptions provided under 45 CFR 153.400 applies to such coverage. These plans are known as “Contributing Entities” and include both:

  • Insured plans (health insurance issuers pay the fee), and
  • Self-insured group health plans that do not self-administer claims


The Transitional Reinsurance Program was created by the Affordable Care Act (ACA) section 1341 to help stabilize premiums in the individual market in 2014-2016. It is intended to collect $25 billion in fees from group health plans during 2014-2016 to partially reimburse insurers in the individual Exchange/Market who cover high-cost individuals. Note that the payment in 2017 (for the 2016 benefit year) will be the third and last reinsurance payment (unless Congress extends the program, which seems unlikely).

For the past two years Leavitt has posted lengthy articles on the reinsurance fee, and we have a 2016 in-depth article on the Transitional Reinsurance and PCORI fees (available from your Leavitt advisor), so this year’s article is shorter and includes links to the government’s Educational Resources (below).

How Does a Contributing Entity Make Reinsurance Contributions?

  1. Contributing entities, or third party administrators or administrative services-only contractors on their behalf, must register on Pay.gov.  Any contributing entity or third party administrators or administrative services-only contractor who created a Pay.gov account for the 2014 or 2015 benefit year can use this account for the 2016 benefit year.
  2. Using Pay.gov, access the “2016 ACA Transitional Reinsurance Program Annual Enrollment and Contributions Submission Form” to enter the annual enrollment count for the 2016 benefit year.  Please note that there is a specific Form for each benefit year.
  3. The Form will auto-calculate the annual contribution amount to be remitted, based on the annual enrollment count during the first nine calendar months of the year.
  4. The contributing entity will then schedule payment for the calculated reinsurance contributions on the payment page.


Educational Resources – on the CCIIO website

The Educational Resources on the CCIIO website are extremely helpful, whether this is your first year sponsoring a self-insured group health plan or your third.  The resources provide an overview, explain the allowable counting methods and provide examples, explain the supporting documentation (.CSV file) and when it is needed (only if you are reporting for four or more entities), and explain how to update or correct filings and how to request a refund if your initial filing overstates the number of covered lives.

Educational Resources

2016 Operational Guidance Documents