HHS increases 2014 transitional reinsurance program coinsurance rate

The Department of Health and Human Services yesterday increased the coinsurance rate in the transitional reinsurance program for the 2014 benefit year from 80% to 100%, noting that reinsurance contributions exceeded requests for reinsurance payments. On June 30, the agency expects to send each eligible health plan issuer a report describing the total reinsurance amount they will receive for the 2014 benefit year. The transitional reinsurance program was established by the Affordable Care Act to stabilize premiums in the individual health insurance market for the first three years of the new insurance marketplaces. According to a report released in April, the program collected about $8.7 billion in reinsurance contributions for 2014, and expects to collect about $1 billion more by Nov. 15.