About Those Pesky Grandfathered Plans

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There has been some discussion here to the effect that healthcare reform did not provide for grandfathered status, so I thought I would post this new bulletin in its entirety. This is today's legislative update from Blue Cross Blue Shield OF TEXAS.

Grandfathered Plans
Last week Interim Final Regulations were issued from the Departments of HHS, Labor, and Treasury around “grandfathered plans” under the Patient Protection and Affordable Care Act of 2010 (PPACA). Health benefit plans in effect on March 23, 2010, are considered grandfathered health plans, which will not be subject to certain PPACA provisions.

The new regulations allow insurers and their customers to make only certain types of changes to their existing health plans while maintaining their grandfathered status. However, if an employer, member or insurer wants to make any changes to their plan beyond those defined in the regulations, they would lose their grandfathered status and have to follow the new rules identified by PPACA.
As shared with you last week, HHS included in its rules clarification that grandfathered plans:

• Cannot significantly cut or reduce benefits
• Cannot raise coinsurance charges
• Cannot significantly raise copayment charges
• Cannot significantly raise deductibles
• Cannot significantly lower employer contributions
• Cannot add or tighten an annual limit on what the insurer pays
• Cannot change insurance companies

We are currently analyzing the financial and operational impact of these regulations so we can help our customers understand their options and thus make their best decisions as they renew their coverage, as well as ensure our internal systems and processes are prepared for compliance.