February 25, 2019

Departments Seek Ways to Help Health Plan Sponsors Preserve “Grandfathered Status” under the Affordable Care Act

On February 25, 2019 in the Federal Register, the Departments of Treasury, Labor, and Health and Human Services (collectively, the “Departments”) published a request for information about grandfathered status under the Affordable Care Act. In general, the Departments are asking for information about the challenges that plan sponsors face in preserving their grandfathered status* and whether there are ways that the Departments could assist plan sponsors in maintaining that status.

The specific questions include:

  • Do any of the requirements for maintaining grandfathered status create particular challenges, and how could these requirements be modified to reduce these challenges?
  • Why do plan sponsors choose to retain grandfathered status?
  • What are the costs and benefits that plan sponsors consider in deciding whether to retain grandfathered status?
  • Is preserving grandfathered status important to plan participants?
  • What changes in benefits typically trigger a loss of grandfathered status?

Plan sponsors that would like to submit comments about how the Departments could modify existing requirements to make it less challenging to preserve grandfathered status will need to act quickly. Comments on the request are due by March 27, 2019.

 

* As a reminder, “grandfathered plans” are those in existence when the Affordable Care Act was enacted on March 23, 2010, which have not made certain benefit or employee or employer contribution changes that result in the loss of grandfathered status, and which have complied with certain notice requirements.

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Kathryn L. Bakich

Kathryn L. Bakich

SVP, National Health Compliance Practice Leader

Joanne Hustead

Joanne Hustead

SVP, Deputy Practice Leader, National Health Compliance Practice