Feds Propose Fee On Health Insurers In New Market

Health insurance companies will have to pay to play in new health insurance markets coming under President Barack Obama’s health care law, according to a regulatory notice issued by the administration.

The Health and Human Services department is proposing a user fee amounting to 3.5 percent of premiums for health insurers who want to offer policies in new federal exchanges coming in 2014. The fee is to cover administrative costs of the new markets, which were designed to be self-supporting.

Exchanges are new online markets where consumers will be able to buy individual private policies and apply for government subsidies to help pay their premiums. About half of the 30 million people expected to gain coverage under the law will get policies in the new exchanges, and the other half will be covered under Medicaid. Washington will run the exchanges in states that decline to do so themselves.
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