As explained in our February 13, 2020 QuickStudy, CMS has proposed a new excess of loss and quota share reinsurance rule. Although it is a welcome development there are significant ambiguities in the proposed rule that we believe will perpetuate the legal uncertainties MAOs have operated under during the past several years regarding the use of quota share reinsurance. CMS will accept comments no later than 5:00 p.m. on April 6, 2020. We very much encourage MAOs and their representatives to take this opportunity to comment on the proposed rule. Comments can be submitted to CMS electronically at https://www.federalregister.gov/documents/2020/02/18/2020-02085/medicare-and-medicaid-programs-contract-year-2021-and-2022-policy-and-technical-changes-to-the. The comments we submitted on March 27, 2020 can be found here.

We shall report back with any new developments.