The Secretary shall include in the provisions under paragraph (1) the method for determining the amount each health insurance issuer and group health plan described in paragraph (1)(A) contributing to the reinsurance program under this section is required to contribute under such paragraph for each plan year beginning in the 36-month period beginning January 1, 2014. The contribution amount for any plan year may be based on the percentage of revenue of each issuer and the total costs of providing benefits to enrollees in self-insured plans or on a specified amount per enrollee and may be required to be paid in advance or periodically throughout the plan year.
42 U.S. Code § 18061. Transitional reinsurance program for individual market in each State
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(a) In generalEach State shall, not later than January 1, 2014—
establish (or enter into a contract with) 1 or more applicable reinsurance entities to carry out the reinsurance program under this section.
(b) Model regulation
(1) In generalIn establishing the Federal standards under section 18041(a) of this title, the Secretary, in consultation with the National Association of Insurance Commissioners (the “NAIC”), shall include provisions that enable States to establish and maintain a program under which—
the applicable reinsurance entity collects payments under subparagraph (A) and uses amounts so collected to make reinsurance payments to health insurance issuers described in subparagraph (A) that cover high risk individuals in the individual market (excluding grandfathered health plans) for any plan year beginning in such 3-year period.
(2) High-risk individual; payment amountsThe Secretary shall include the following in the provisions under paragraph (1):
(A) Determination of high-risk individualsThe method by which individuals will be identified as high risk individuals for purposes of the reinsurance program established under this section. Such method shall provide for identification of individuals as high-risk individuals on the basis of—
a list of at least 50 but not more than 100 medical conditions that are identified as high-risk conditions and that may be based on the identification of diagnostic and procedure codes that are indicative of individuals with pre-existing, high-risk conditions; or
(B) Payment amountThe formula for determining the amount of payments that will be paid to health insurance issuers described in paragraph (1)(B) that insure high-risk individuals. Such formula shall provide for the equitable allocation of available funds through reconciliation and may be designed—
to provide a schedule of payments that specifies the amount that will be paid for each of the conditions identified under subparagraph (A); or
to use any other comparable method for determining payment amounts that is recommended by the American Academy of Actuaries and that encourages the use of care coordination and care management programs for high risk conditions.
(3) Determination of required contributions
(A) In general
(B) Specific requirementsThe method under this paragraph shall be designed so that—
the aggregate contribution amounts for all States shall, based on the best estimates of the NAIC and without regard to amounts described in clause (ii), equal $10,000,000,000 for plan years beginning in 2014, $6,000,000,000 for plan years beginning  2015, and $4,000,000,000 for plan years beginning in 2016; and
in addition to the aggregate contribution amounts under clause (iii), each issuer’s contribution amount for any calendar year under clause (iii) reflects its proportionate share of an additional $2,000,000,000 for 2014, an additional $2,000,000,000 for 2015, and an additional $1,000,000,000 for 2016.
Nothing in this subparagraph shall be construed to preclude a State from collecting additional amounts from issuers on a voluntary basis.
(4) Expenditure of fundsThe provisions under paragraph (1) shall provide that—
(c) Applicable reinsurance entityFor purposes of this section—
(1) In generalThe term “applicable reinsurance entity” means a not-for-profit organization—
(2) State discretion
(3) Entities are tax-exempt
(d) Coordination with State high-risk pools
Subsec. (b)(2)(B). Pub. L. 111–148, § 10104(r)(2), substituted “paragraph (1)(B)” for “paragraph (1)(A)” in introductory provisions.
 So in original. A second closing parenthesis probably should precede the semicolon.
 So in original. Probably should be followed by “in”.
 So in original. Probably should be preceded by “of”.
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