Tax on Claims Coming in 2012

On September 20, Governor Snyder signed into law the Health Insurance Claims Assessment Act. This law creates a 1% assessment on most medical, prescription drug, dental and vision claims for Michigan residents beginning on January 1, 2012. The revenue collected for the assessment will support Michigan’s Medicaid program, replacing the current revenue source.

Every insurance carrier, third-party administrator and stop-loss carrier serving Michigan residents will be required to pay the 1% assessment quarterly. The cost of the assessment will be passed along to group health plan sponsors; more details of this fee will be forthcoming. ASR representatives attended a meeting in Lansing regarding this claims assessment sponsored by the state of Michigan on November 17, but we are still awaiting guidance from the state on some significant details of the new law. When we receive additional information, we will communicate it to our clients directly.