Immediate Group Health Plan Mandates
Friday, July 30, 2010
The Affordable Care Act imposes a number of new requirements on group health plans and employers/plan sponsors. The requirements will phase in over the next several years.
Of highest priority are the major changes that group health plan must incorporate immediately. A list of these critical mandates is provided below.
Except for the coverage of dependent children to age 26, the regulations necessary to implement the required changes have yet to be issued. Once they are, SBS will provide the details.
“Grandfathered plans” escape the need to comply with some of the mandates. Guidance on grandfathered plans has yet to be issued. Grandfathered plans are currently understood to be plans that were in existence on March 23, 2010 (the date that the Patient Protection and Affordable Care Act was signed into law). Absent regulations, it is unclear whether discretionary plan amendments will cause plans to lose their grandfathered status.
Group Health Plan Mandates for Plan Years Beginning on or after September 23, 2010 (January 1, 2011 for calendar year plans) | Exception for Grandfathered Plans |
If plan provides dependent coverage, extend coverage to adult children to age 26. Until January 1, 2014, grandfathered plans can exclude adult children who have not attained age 26 if the children are eligible to enroll in an employer-sponsored health plan other than a group health plan of a parent. | Yes, in part, until 2014 |
Implement new claims appeal process. External review required in some situations. | Yes |
If plan provides for in-network coverage and provides for or requires the designation of a participating primary care provider, permit enrollees to designate any available participating primary care provider. Permit enrollees to designate a pediatrician as the primary care provider for a child. | Yes |
Eliminate any preauthorization or referral requirements for obstetrical and gynecological care. | Yes |
If plan covers emergency services, eliminate any preauthorization requirements and cover expenses at the in-network benefit level. | Yes |
Cover certain preventive care without cost-sharing (e.g., copayment, coinsurance, deductibles). | Yes |
Perform nondiscrimination testing specified in Internal Revenue Code Section 105(h) on fully insured plans. (Self insured plans are already subject to this requirement.) | Yes |
Eliminate lifetime dollar limits on “essential health benefits” (e.g., ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health, substance abuse, and behavioral health services; prescription drugs; rehabilitative and habilitated services and devices; laboratory services; preventive and wellness services and chronic disease management; pediatric services, including oral and visual care). | No |
Comply with maximum annual limits on essential health benefits. (Annual limits must be eliminated in 2014.) | No |
Eliminate any pre-existing condition limitations or exclusions for children under age 19. (Any pre-existing condition limitations or exclusions must be eliminated for all enrollees in 2014.) | No |
Eliminate any coverage rescission provisions absent an enrollee committing fraud or intentionally misrepresenting material fact. | No |