Maintaining Grandfathered Plans

Grandfathered plans are exempt from many reforms, but they are still subject to certain guidelines.

This includes:

  • Changes in tax rules relating to health plans.
  • Summary of Benefits and Coverage requirements.
  • Cost reporting and rebates.
  • Auto enrollment.
  • Notification of the Exchange.

Regulations Grandfathered Plans Must Comply With

Grandfathered plans are subject to the following regulations.

  • Elimination of annual and lifetime limits on spending.
    • Plans can no longer have dollar limits on the 10 essential health benefits.
  • Limitation on pre-existing conditions.
    • Carriers cannot discriminate against pre-existing conditions.
  • Limitation on waiting periods.
    • Waiting periods can be no longer than 90 days.
  • Coverage of children up to the age of 26.
  • Prohibition on recissions
    • Carriers cannot cancel an enrollee's insurance for any reason other than fraud or non-payment.

Plan Additions Disqualifying Grandfathered Status

Some plan changes may disqualify plans from maintaining their grandfathered status. Some of these additions are:

  • Increase of the contribution amount for any tier of coverage by 5% or more.
  • Changes in deductible or out-of-pocket max by 15% or more.
  • Any increase in the employee’s coinsurance percentage.
  • Elimination of coverage to diagnose or treat a particular condition.
  • Moving employees to a grandfathered plan with lower benefits.
  • Reduction or new addition of annual limit(s).

Plan Additions Without Losing Grandfathered Status

There are a few changes that are allowed to occur to grandfathered health plans that do not disqualify them from their grandfathered status.

  • Premium increases.
  • Allowing dependent enrollments as result of Qualifying Life Events.
  • Certain Affordable Care Act compliance regulations.

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