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B-328016 1 (2016-09-29)

handle is hein.gao/gaobadson0001 and id is 1 raw text is: G U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 B-328016 September 29, 2016 Congressional Requesters Subject: Department of Health and Human Services: Transitional Reinsurance Program This responds to your April 13, 2016 request for our opinion regarding the Department of Health and Human Services' (HHS) administration of the transitional reinsurance program established under section 1341 of the Patient Protection and Affordable Care Act (PPACA).1 The transitional reinsurance program, which is financed by statutorily required contributions from participating health insurance issuers and group health plans (issuers), makes payments to eligible issuers to stabilize health insurance premiums and encourage issuer participation in the health insurance markets. Section 1341 designates a specified amount of collections from issuers for reinsurance payments and also directs the deposit of a specified amount of collections in the general fund of the United States Treasury (Treasury). You asked whether HHS has the authority, in the event its collections from issuers do not reach the specified amount for reinsurance payments, to prioritize collections for payments to issuers over payments to the Treasury. In accordance with our regular practice, we contacted HHS to obtain additional factual information and its legal views on this matter.2 HHS provided us with information and its legal views. 3 As explained below, we conclude that HHS lacks authority to ignore the statute's directive to deposit amounts from collections under the transitional reinsurance program in the Treasury and instead make deposits to the Treasury only if its collections reach the amounts for reinsurance payments specified in section 1341. This prioritization of collections for payments to issuers over payments to the Treasury is not authorized. The agency must give effect to the extent possible to all of section 1341, and, therefore, is required to collect and deposit amounts for the Treasury, regardless of whether its collections fall short of the amounts specified in statute for reinsurance payments. 1 Pub. L. No. 111-148, tit. I, subtitle D, pt. V, § 1341, 124 Stat. 119, 208-11 (Mar. 23, 2010) (hereafter, PPACA) (classified at 42 U.S.C. § 18061). 2 GAO, Procedures and Practices for Legal Decisions and Opinions, GAO-06-1064SP (Washington, D.C.: Sept. 2006), available at http://www.gao.gov/assets/210/203101 .pdf. 3 Letter from Acting General Counsel, HHS, to Managing Associate General Counsel for Health Care, GAO (July 27, 2016) (hereafter, HHS Response).

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