Coordinating Individual Qualifying Covered Retiree Costs

User Roles:




Program Components:

Interim Payment


When completing cost reporting during a Plan Year or Reconciliation, the Plan Sponsor submits cost data for Qualifying Covered Retirees (QCR) for the corresponding subsidy period and Benefit Option(s) in which the QCR is enrolled. The Plan Sponsor is required to coordinate individual retiree cost data in the following situations: multiple cost reporters are reporting costs for a single Benefit Option, any individual retirees are enrolled in more than one Benefit Option during the same time period or different time periods, or if any individual retirees are enrolled in one Benefit Option for two or more separate subsidy periods. Cost data for these situations should be considered carefully by the Plan Sponsor to ensure proper reporting. For more information, go to: How should coordination of individual retiree cost data be handled?

Only cost data that fall between the Threshold Reduction and Limit Reduction are eligible for subsidy. The Threshold Reduction is calculated as the amount below the federally defined cost threshold, which is not eligible for subsidy. The Limit Reduction is calculated as the amount above the federally defined cost limit, which is not eligible for subsidy.

The Plan Sponsor is responsible for coordinating calculated Cost Thresholds and Cost Limits for QCRs prior to reporting any cost data in Reconciliation Step 6: Manage Submission of Final Cost Reports. For each QCR in an Application, the Plan Sponsor must apply the applicable Cost Threshold and Cost Limit to all gross cost data reported for that individual for the entire RDS Plan Year. The Plan Sponsor must not apply the Cost Threshold and Cost Limit separately to each discrete set of gross cost data reported by each Vendor, if multiple Vendors are reporting cost data. Calculations should be performed throughout the Application Plan Year to ensure that all cost data are correct and up to date. Plan Sponsors must keep retiree-level data for audit purposes.

Currently members of the RDS community are facing choices about how to coordinate costs. In the case that a Plan Sponsor has a single Vendor reporting all cost data for affected beneficiaries, the Plan Sponsor or the Vendor may coordinate the cost data. Plan Sponsors that have multiple Vendors reporting cost data for affected beneficiaries must decide if they will collect the data from the Vendors and coordinate the cost data themselves or choose a third party to do so. Regardless of who is designated as the coordinator for Threshold Reductions and Limit Reductions, the E-PHI Agreement must be considered since Protected Health Information is involved in all calculations.

If you have questions or need additional information, contact CMS' RDS Center.