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