Sec. 221. Invisible Guaranteed Coverage Pool Reinsurance Program; tax on exchange plans
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/bill/116/s/4796/is/section-221A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Not later than January 1, 2021, the Secretary of Health and Human Services shall establish the Invisible Guaranteed Coverage Pool Reinsurance Program (in this section referred to as the IGCPR program ). Under the IGCPR program, the Secretary shall, from amounts appropriated under subsection
(f)for a fiscal year, award grants to States for such fiscal year, in amounts determined in accordance with the allocation methodology specified under subsection (d). Such grants shall be used for the purpose of establishing or maintaining a qualifying Invisible Guaranteed Coverage Pool for the State. In the case of a State that does not, by a date and in a manner specified by the Secretary, choose to be awarded a grant under subsection
(b)for a fiscal year to operate a qualifying Invisible Guaranteed Coverage Pool for the State, the Secretary shall, from amounts appropriated under subsection
(f)for such fiscal year, use the allocation determined for the State under subsection
(d)for participation of such State in the Federal default qualifying Invisible Guaranteed Coverage Pool described in paragraph (2). The Federal default qualifying high risk pool is, with respect to each State that chooses not to be awarded a grant under subsection
(b)with respect to a fiscal year for which funds are appropriated under subsection (f), an Invisible Guaranteed Coverage Pool under which health insurance issuers participating in the Exchange of such a State, with respect to designated individuals who are enrolled in health insurance coverage and are expected to experience higher than average health costs as determined by the insurer, cede risk to the pool, without affecting the premium paid by the designated individuals or their terms of coverage. With respect to such pool— high-risk individuals designated for cession to the pool shall be designated by the ceding issuer; the premium amount the ceding issuer shall pay to the reinsurance pool shall be 90 percent of the premium paid to the issuer for the coverage; the ceding issuer shall retain the same risk under the ceded policies as under any other policy of the issuer with respect to the first $10,000 of benefits for each ceded policy involved and will not retain any risk under ceded policies after such first $10,000 of benefits; and after a ceding issuer, with respect to a ceded policy, no longer retains risk under such policy pursuant to subparagraph (C), the negotiated rate under such policy for items and services shall be payable at the reimbursement rate under the Medicare program under title XVIII of the Social Security Act for such items and services, or in the case of items and services for which payment is available under the policy but not the Medicare program, at a rate determined by the Secretary. Not later than June 30, 2021, the Secretary shall specify an allocation methodology for determining the amount of funds appropriated under subsection
(f)for a fiscal year to be allocated for each State for purposes of subsections
(b)and (c). Such methodology shall be based on the number of residents of each State and the general health status of such residents. For purposes of this section, the term qualifying Invisible Guaranteed Coverage Pool means, with respect to a State, a method of designation under which health insurance issuers identify individuals who experience higher than average health costs as determined by the State and are enrolled in health insurance coverage offered in the individual market, and cede the risk of spending more than $10,000 on health care services for a single individual to the pool without affecting the premium paid by the designated individuals or their terms of coverage. With respect to such pool, the State, or an entity operating the pool on behalf of the State, shall establish— the premium amount the ceding issuer shall pay to the reinsurance pool; the applicable attachment points or coinsurance percentages if the ceding issuer retains any portion of the risk under ceded policies, except that the provisions of subparagraphs
(C)and
(D)of subsection (c)(2) shall apply to such high risk pool in the same manner as such clauses apply to the Federal default high risk pool; and the mechanism by which high-risk individuals are designated for cession to the pool, which may include a list of designated high-cost health conditions. There is appropriated to the Secretary of Health and Human Services $200,000,000,000 to carry out this section for the period of fiscal year 2021 through fiscal year 2029. Chapter 34 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter: Sec. 4401. Additional tax on health insurance plans sold by insurers offering plans on exchanges. There is imposed a tax of $4 for each policy month of each health insurance policy sold by insurers offering plans through an Exchange established under the Patient Protection and Affordable Care Act. The tax imposed by subsection
(a)shall be paid by the plan sponsor. . The table of subchapters for chapter 34 of the Internal Revenue Code of 1986 is amended by adding at the end the following item: Subchapter C—Additional tax on health insurance plans sold by insurers offering plans on exchanges . The amendments made by this subsection shall apply with respect to months beginning after the date of enactment of this Act. The Secretary of Health and Human Services, in collaboration with the Comptroller General of the United States, shall submit to Congress, not later than January 1, 2026, and again 5 years thereafter, a report on the status of reinsurance pool funding, along with any recommendations with respect to future allocations or funding methods for such pool.