The Patient Protection and Affordable Care Act’s (ACA’s) Transitional Reinsurance Program. Namrata K. Uberoi, Analyst in Health Care Financing; Edward C. Liu, Legislative Attorney. November 16, 2016.

“Section 1341 of the Patient Protection and Affordable Care Act (ACA; P.L. 111-148, as amended) establishes a transitional reinsurance program that is designed to provide payment to non-grandfathered, non-group market health plans (also known as individual market health plans) that enroll high-risk enrollees for 2014 through 2016. Under the program, the Secretary of the Department of Health and Human Services (HHS) collects reinsurance contributions from health insurers and from third- party administrators on behalf of group health plans. The Secretary then uses those contributions to make reinsurance payments to health insurers who enroll high-cost enrollees (statutes required the HHS Secretary to determine how high-risk enrollees are identified, and the Secretary in turn defined high-risk enrollees as high-cost enrollees) in their non-group market plans both inside and outside of the exchanges(also known as the marketplaces).That is, contributions are distributive in which they are collected from most non-group and group health insurers, but payments are made only to eligible non-group market health plans.”