Private Reinsurance Arrangements with Employer/Union Group

10.3 – Private Reinsurance Arrangements with Employer/Union Group Health Plan Sponsors (Rev. 111, 05-03-13, Effective: 05-03-13, Implementation: 05-03-13) MA organizations must meet State licensure and financial solvency requirements under 42 CFR 422, Subpart I. With regard to these requirements, all MAOs are permitted to obtain reinsurance or make other arrangements for the cost of coverage provided to any enrollee (including 1 For further detail on 1876 and 1833 (HCPP) Cost benefit requirements, please see Medicare Managed Care Manual, Chapter 17 (Cost Based Payment). arrangements with employers/unions) to the extent that the MAO is at risk for providing the coverage. (See 42 CFR 423.401(b).) Similarly, Medicare requirements do not prohibit MAOs offering “800 series” or individual MA plans to employer and union group health plan sponsors from entering into these kinds of reinsurance arrangements with self-insured (i.e., self-funded) employers/unions.2 Notwithstanding these arrangements, the MAO retains the responsibility for meeting all Medicare requirements.