§9704 Liability of Assigned Operators

Summary

Assigned operators must pay one yearly premium to the Combined Fund for each plan year starting February 1, 1993. That yearly premium is the sum of three parts: a health benefit part, a death benefit part, and an unassigned-beneficiaries part. The health part is the per‑person charge times the number of people assigned to the operator. The per‑person charge is based on the average health cost from the plan year that began July 1, 1991, adjusted if the medical Consumer Price Index for the year the plan starts is higher than in 1992. If Medicare cuts reduce the Fund’s health benefits, trustees must raise the per‑person charge enough to keep benefits at the same level. The death part is a percentage of the Fund’s actuarial cost for death benefits. The unassigned part applies to operators’ shares of costs for people not assigned to any operator until October 1, 2006; after that date those costs are paid from a transfer source unless that transfer is too small, in which case operators pay their share. Trustees must keep three separate accounts for the three premium parts, allocate administrative costs and interest in set ways, and adjust next year’s premiums up or down for shortfalls or surpluses (with some limits and carryover rules). Annual premiums are payable in 12 equal monthly payments due on the 25th of each month; the premium for the plan year that began February 1, 1993, is added to the premium for the plan year that began October 1, 1993. An operator’s share (the “applicable percentage”) is the number of eligible people assigned to that operator divided by the total assigned to all operators, based on assignments as of October 1, 1993, and redetermined after October 1, 1994 to reflect successful appeals, businesses that stopped operating, and (for years starting October 1, 2007) revoked assignments. Trustees must give the Social Security Commissioner benefit and enrollment data within 60 days after enactment. Special rules require certain “1988 agreement” operators to make extra contributions for the plan year starting February 1, 1993, and to help pay off prior unpaid plan expenses through September 30, 1994; those contributions reduce their premiums. Finally, an assigned operator or related party may make a one‑time payment equal to the present value of its future premium liability if an enrolled actuary certifies it, the report is filed with the Department of Labor, and 90 calendar days pass without objection; the Fund must hold that payment in a named account and use it only to pay that operator’s premiums.