Health care reform laws explained

Health reform and your business

An overview of the main health reform requirements and what you (or we) need to do to comply with each one.

All requirements take effect as your plan renews on 9/23/2010 or later, unless noted.

Learn more about these requirements:

• Extension of dependent coverage
• Preventive care coverage
• Lifetime and annual limits
• Pre-existing condition exclusions
• Rescission prohibition
• Emergency services coverage
• Selection of primary care physician
• Salary non-discrimination of benefits  
• Small business tax credit
• Tax treatment of OTC drugs
• Appeal and grievance procedures
  

Grandfathered vs. non-grandfathered health plans

Under the health reform legislation, groups who like the health plan they have can keep it. This is called "grandfathered status." Grandfathered health plans do not have to follow some reform provisions including those requiring:

• Comprehensive health care coverage
• 100% coverage for preventive care
• Guaranteed availability of coverage
• Guaranteed renewability of coverage
• Salary nondiscrimination in benefits
• Appeals/patient protections
• Fair health insurance premiums

Determining grandfathered eligibility

Determining if your plan is eligible for grandfathered status is a multi-step process:

1. The plan must have been in place on 3/23/2010
2. At least one person must have been continually enrolled in the plan since 3/23/2010

Telling your employees

If your plan is grandfathered, you must tell your employees that it is grandfathered and not required to offer some of the benefits called for by the Affordable Care Act. This information must be included in any plan materials given to your employees and/or their dependents.

Use this sample language with your plan information:

This [group health plan or health insurance issuer] believes this [plan or coverage] is a "grandfathered health plan" under the Patient Protection and Affordable Care Act (the Affordable Care Act). As permitted by the Affordable Care Act, a grandfathered health plan can preserve certain basic health coverage that was already in effect when that law was enacted. Being a grandfathered health plan means that your [plan or policy] may not include certain consumer protections of the Affordable Care Act that apply to other plans, for example, the requirement for the provision of preventive health services without any cost sharing. However, grandfathered health plans must comply with certain other consumer protections in the Affordable Care Act, for example, the elimination of lifetime limits on benefits.

Questions regarding which protections apply and which protections do not apply to a grandfathered health plan and what might cause a plan to change from grandfathered health plan status can be directed to the plan administrator at [insert contact information]. [For ERISA plans, insert: You may also contact the Employee Benefits Security Administration, U.S. Department of Labor at 866 444–3272 or www.dol.gov/ebsa/healthreform. This website has a table summarizing which protections do and do not apply to grandfathered health plans.] [For individual market policies and nonfederal governmental plans, insert: You may also contact the U.S. Department of Health and Human Services at www.healthcare.gov.]

Source: U.S. Department of Labor

Maintaining grandfathered status

Once you've established grandfathered status, you must follow certain requirements to maintain that status. Learn about these requirements at understandinghealthreform.com.