Issued by: Centers for Medicare & Medicaid Services (CMS)

Issue Date: April 20, 2016

Program Area: Distributed Data Collection (DDC) for RA Including HCRP/EDGE Server

Question: If an issuer acquires policies in the Individual or Small Group Market that include risk adjustment covered plans or reinsurance-eligible plans partway through a benefit year, how should the issuer submit enrollment and claims data to the EDGE server?

Answer: As outlined in the HHS Notice of Benefit and Payment Parameters for 2017 Final Rule (81 FR 12204, 12238), an entity acquiring or entering into another arrangement with an issuer to serve the current enrollees under a plan with substantially the same coverage terms, may accrue the previous months of claims experience for purpose of risk adjustment and reinsurance to fully reflect the enrollees' risk and claims costs. Multiple options are available in submitting the insolvent or acquired issuer's enrollment and claims data to the EDGE server(s): 1. Both the acquiring entity and acquired issuer could separately submit EDGE server enrollment and claims data, with each submitting the claims data related to the period of time in which it provided coverage to the respective enrollees. This data would be considered separate in the reinsurance payment calculations and risk adjustment transfer calculations. 2. The acquiring entity and acquired issuer may arrange for a single EDGE server data submission. CMS finalized a "substantially the same" standard because in many of these situations, an acquiring entity's platform may require some adjustments to the plan arrangement and coverage terms. As part of meeting this standard, an acquiring entity would be required to carry over accumulators for deductibles and annual limitations on cost sharing. If the "substantially the same" standard is met, and the acquired issuer and the acquiring entity agree that the acquiring entity will accrue the previous months of claims experience, the acquiring entity must take responsibility for submitting to the respective EDGE server(s) complete and accurate claims and baseline information for that benefit year (including data from the insolvent issuer) in accordance with HHS's operational guidance to maintain eligibility to receive payments under this program for the given benefit year. Operationally, the acquiring entity may elect to have the insolvent issuer submit the data on behalf of both entities. CMS will work with issuers and acquiring entities in these situations to facilitate the submission of accurate and complete data to EDGE servers that is necessary to calculate risk adjustment financial transfers and reinsurance payments, though the ultimate responsibility for the submission will rest with those parties. Please contact EDGE_server_data@cms.hhs.gov for CMS assistance.

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