November 8, 2012, Introduced by Senator KAHN and referred to the Committee on Appropriations.
A bill to amend 2011 PA 142, entitled
"Health insurance claims assessment act,"
by amending section 3 (MCL 550.1733).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. (1) For dates of service beginning on or after January
1, 2012, subject to subsections (2), (3), and (4), there is levied
upon and there shall be collected from every carrier and third
party
administrator an assessment of 1% on that carrier's or third
party administrator's paid claims at the following rate:
(a) In 2012, 1%.
(b) In 2013 through 2014 except as otherwise provided in this
subdivision, the rate levied in the immediately preceding year.
However, if the department of treasury determines that the rate
levied in the immediately preceding year collected revenue in an
amount less than or greater than the base need, the department of
treasury shall increase or reduce the rate, as appropriate, to a
rate that would have generated for the immediately preceding year
revenue equal to the base need. As used in this subdivision:
(i) "Base need" means the following:
(A) For 2012, $400,000,000.00.
(B) For 2013 and each year after 2013, the base need in the
immediately preceding year adjusted by the medical inflation rate.
(ii) "Medical inflation rate" means that rate determined by the
annual national health expenditures accounts report issued by the
federal centers for medicare and medicaid services, office of the
actuary.
(2) A carrier with a suspension or exemption under section
3717 of the insurance code of 1956, 1956 PA 218, MCL 500.3717, on
the effective date of this act is subject to an assessment of 0.1%.
(3) All of the following apply to a group health plan that
uses the services of a third party administrator or excess loss or
stop loss insurer:
(a) A group health plan sponsor shall not be responsible for
an assessment under this subsection for a paid claim where the
assessment on that claim has been paid by a third party
administrator or excess loss or stop loss insurer, except as
otherwise provided in section 3a(2).
(b) Except as otherwise provided in subdivision (d), the third
party administrator shall be responsible for all assessments on
paid claims paid by the third party administrator.
(c) Except as otherwise provided in subdivision (d), the
excess loss or stop loss insurer shall be responsible for all
assessments on paid claims paid by the excess loss or stop loss
insurer.
(d) If there is both a third party administrator and an excess
loss or stop loss insurer servicing the group health plan, the
third party administrator shall be responsible for all assessments
for paid claims that are not reimbursed by the excess loss or stop
loss insurer and the excess loss or stop loss insurer shall be
responsible for all assessments for paid claims that are
reimbursable to the excess loss or stop loss insurer.
(4) The assessment under this section shall not exceed
$10,000.00 per insured individual or covered life annually.
(5) To the extent an assessment paid under this section for
paid claims for a group plan or individual subscriber is inaccurate
due to subsequent claim adjustments or recoveries, subsequent
filings shall be adjusted to accurately reflect the correct
assessment based on actual claims paid.
(6)
If the assessment under this section collects revenue in
an
amount greater than $400,000,000.00, adjusted annually by the
medical
inflation rate, each carrier and third party administrator
that
paid the assessment shall receive a proportional credit
against
the carrier's or third party administrator's assessment in
the
immediately succeeding year. The department shall send a notice
of
credit to each carrier or third party administrator entitled to
a
credit under this subsection not later than July 1. A carrier or
third
party administrator entitled to a credit under this
subsection
shall apply that credit to the July 30 payment. Any
unused
credit shall be carried forward and applied to subsequent
payments.
If a carrier or third party administrator entitled to a
credit
under this subsection has no liability under this act in the
immediately
succeeding year or if this act is no longer in effect,
the
department shall issue that carrier or third party
administrator
a refund in the amount of any unused credit. If a
third
party administrator receives a credit or refund under this
subsection,
the third party administrator shall apply that credit
or
refund to the benefit of the entity for which it processed the
claims
under a service contract.