I’ve long been in favor of comparative effectiveness research (aka science) in healthcare, and I think the creation of the Patient-Centered Outcomes Research Institute (a non-profit corporation rather than a government agency) will benefit all of us in the long run. Of course, a program like this has to be funded somehow. Starting next year, insurance companies will begin collecting a comparative effectiveness research (CER) fee of $1 per member for the plan years ending after September 30, 2012. For plan years ending after September 30, 2013, the fee will be $2 per member. And for plan years after that (up through 2019), the fee will be indexed and tied to the National Health Expenditures published by HHS.
We’ve received communication from Rocky Mountain Health Plans regarding the CER fee and how they will go about collecting it. Starting in January 2012, they will begin collecting 11 cents per member per month for the duration of 2012. The one dollar mark – or, more specifically, 99 cents – will be reached in September, when the plan year delineations are made. Money collected in the fourth quarter of 2012 will be applied towards the CER fee for plan years ending September 30, 2013. And we can assume that the monthly collection rate will increase in 2013, since the total annual fee that year will be $2 per member.
We have not heard from other Colorado carriers yet with specifics in terms of how they plan to collect the fee. The ACA guidelines left things pretty wide open as far as I can tell. I believe carriers are free to collect the money on a monthly basis like Rocky Mountain Health Plans, or all at once with a single $1 charge the first year, $2 charge the second year, and so on.
This fee is similar to the one that is assessed to pay for CoverColorado (except that it’s a much smaller amount). Basically, carriers will collect the fee from members and then pass the money on to the Patient-Centered Outcomes Research Institute, much the way carriers pass on the CoverColorado fee. The fee will not be counted as premiums for the purpose of calculating medical loss ratio numbers, and should not be confused as being part of the premium that we pay for our health insurance.
