Common use of Health Insurers’ Premium Clause in Contracts

Health Insurers’ Premium. Fee under the ACA The health insurers’ premium fee (HIF) under the ACA is due in September for the preceding calendar year premiums each year unless otherwise modified. If the Contractor is or will be subject to the health insurer’s premium fee for the Capitation Payments being made under this or a previously existing Managed Care Contract with the Commonwealth, the Commonwealth shall compensate the Contractor for that fee and for any federal taxes resulting from such compensation. To facilitate this payment, the Contractor shall provide the Department with the Insurer’s Premium Fee assessment received from the Federal Government and the pro rata portion attributed to the Contractor’s Capitation Payments under its Contract(s) for the preceding calendar year if available. In addition the Contractor shall provide a certified statement from its Chief Financial Officer as to the effective Federal Tax Rate paid for the past five tax periods. These shall be submitted to the Department no later than September 1 of each year that the Insurer’s premium fee is imposed. Beginning July 1, 2015, using the prior year’s assessment as an estimate, the Capitation Payment shall be adjusted to compensate Contractor for the 2015 assessment. This rate shall be adjusted each month based upon the Contractor’s Membership changes and shall be reconciled at the end of the period. The Consolidated Appropriations Act of 2016 suspended the 2017 HIF payment for calendar year 2016 revenue. Therefore, the Commonwealth removed the HIF portion of the monthly capitation rate from January 1, 2016 to December 31, 2016. The HIF portion of the monthly capitation rate will resume on January 1, 2017 unless otherwise modified or suspended. This payment method is contingent upon receipt of federal financial participation for the payment and CMS approval.

Health Insurers’ Premium. Fee under the ACA The health insurers’ premium fee (HIF) under the ACA is due in September for the preceding calendar year premiums each year unless otherwise modified. If the Contractor is or will be subject to the health insurer’s premium fee for the Capitation Payments being made under this or a previously existing Managed Care Contract with the Commonwealth, the Commonwealth shall compensate the Contractor for that fee and for any federal taxes resulting from such compensation. To facilitate this payment, the Contractor shall provide the Department with the Insurer’s Premium Fee assessment received from the Federal Government and the pro rata portion attributed to the Contractor’s Capitation Payments under its Contract(s) for the preceding calendar year if available. In addition addition, the Contractor shall provide a certified statement from its Chief Financial Officer as to the effective Federal Tax Rate paid for the past five tax periods. These shall be submitted to the Department no later than September 1 of each year that the Insurer’s premium fee is imposed. Beginning July 1, 2015, using the prior year’s assessment as an estimate, the Capitation Payment shall be adjusted to compensate Contractor for the 2015 assessment. This rate shall be adjusted each month based upon the Contractor’s Membership changes and shall be reconciled at the end of the period. The Consolidated Appropriations Act of 2016 suspended the 2017 HIF payment for calendar year 2016 revenue. Therefore, the Commonwealth removed the HIF portion of the monthly capitation rate from January 1, 2016 to December 31, 2016. The HIF portion of the monthly capitation rate will resume on January 1, 2017 unless otherwise modified or suspended. This payment method is contingent upon receipt of federal financial participation for the payment and CMS approval.