Blue Cross and Blue Shield of Illinois

 

August 23, 2013

Legislative Update
Finalized 2014 Affordable Care Act (ACA) Fees for Fully Insured Large Groups Now Available

The Annual Fee on Health Insurers (“Health Insurer Fee”) and the Transitional Reinsurance Program Contribution Fee (“Reinsurance Fee”) have been finalized for Blue Cross and Blue Shield of Illinois (BCBSIL) fully insured large groups (151+) at 3.25 percent of billed premiums for 2014. This is a decrease from the previously estimated 4 percent.

This fee percentage began appearing in renewals and proposals for large groups on Monday, Aug. 5, 2013. If you have already released or negotiated a 2014 renewal, you will be contacted by your account representative to adjust the fee information.

Affordable Care Act (ACA) fees will appear on bills beginning in January 2014. A fee disclaimer will be included in bills and will provide the exact amount allocated to applicable federal and state taxes, including the new ACA fees. Medical premiums will be adjusted to include the Health Insurer Fees and Reinsurance Fees, beginning with the bill for January 2014 coverage.

As a reminder, for small groups (2-50), the ACA fees estimate remain at 4 percent of billed premiums in 2014, but this number will be recalculated based on final rate approval by the Illinois Department of Insurance.

About ACA Fees
Beginning in 2014, ACA requires that covered entities providing health insurance (“health insurer”) pay an annual fee to the federal government. This is commonly referred to as the Annual Fee on Health Insurers, or Health Insurer Fee. For the calendar year, the amount of this fee is determined by the federal government and involves a formula based in part on a health insurer’s net premiums from the preceding calendar year. This fee applies to fully insured group and individual market segments.

In addition, ACA provides for the establishment of temporary transitional reinsurance program(s) that will run from 2014 through 2016 and will be funded by reinsurance contributions (“Reinsurance Fee”) from health insurance issuers and self-funded health group plans. This will apply to all group (including self-funded/ASO) and individual market segments.

 
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A Division of Health Care Service Corporation, a Mutual Legal Reserve Company,
an Independent Licensee of the Blue Cross and Blue Shield Association.