CMS on June 30 released its report on the ACA's reinsurance and risk adjustment programs for the 2016 plan year.
The ACA created the permanent risk adjustment program to redistribute funds from plans with lower-risk policyholders to plans with higher-risk policyholders. The transitional reinsurance program, which ran from 2014 through 2016, provided payment to plans enrolling higher-cost policyholders.
Here are five report findings.
1. CMS said the two programs "functioned smoothly" for the 2016 plan year as the ACA-compliant market grew. The amount of paid claims was "strongly correlated" with risk adjustment and reinsurance transfers, the agency said.
2. Nationally, 445 insures will receive reinsurance payments. CMS predicts 52.9 percent of claims between $90 and $250,000 will be payable for the 2016 benefit year, according to a Health Affairs blog post by Timothy Jost, JD, emeritus professor at the Washington and Lee University School of Law in Lexington, Va. Eighty-three percent of the funds is already available through the $3.3 billion collected for the reinsurance program.
3. The risk adjustment program included 751 insurers in 2016 in the individual and small group markets.
4. Payers receiving the largest risk adjustment payments included Jacksonville-based Florida Blue with $464 million and San Francisco-based Blue Shield of California with $371 million.
5. Insurers required to pay the most into the risk adjustment program included California Kaiser Foundation Health Plan in Oakland with $438 million and Long Beach, Calif.-based Molina Healthcare with $544 million.