Focus on Health Care Reform: Six Months Later

The Affordable Care Act was enacted six months ago on March 23, 2010. Here are the reform measures that kicked-in this week on September 23rd – six months from the day of enactment:

  • No pre-existing condition exclusions for children under age 19. “Grandfathered health plans” established before March 23, 2010 may continue their existing policy until 2014, at which time no discrimination based on pre-existing conditions is allowed.
  • No arbitrary rescissions of health insurance. In the past insurers have been able to rescind coverage when a patient gets sick and needs the coverage most. Reform eliminates this practice, except in cases of fraud.
  • No lifetime limits on health insurance coverage. Applies to any plan issued or renewed after Sept. 23, 2010.
  • No annual limits on coverage. Annual limits will be phased out beginning Sept. 23, 2010. The $750,000 minimum limit rises to $1.25 million next year on Sept. 23, 2011, and $2 million the following year. Beginning Jan 1, 2014, annual limits will be prohibited for most plans.
  • Patients will have the option to keep a primary care doctor from among their insurer’s network. Referrals for obstetric or gynecological care cannot be required.
  • Companies will no longer be able to deny coverage for the use of out-of-network emergency services.
  • Preventive services are now covered. Beginning Sept. 23, 2010 all new or renewed health insurance plans must cover preventive services such as vaccinations, mammograms, colonoscopies, and nutrition counseling. 
  • Adult children covered to age 26, unless they qualify for health insurance through their employer.

Some individuals and employers may choose to stay with their current plans, many of which will be grandfathered and exempt from some Sept. 23, 2010 provisions. By 2014, all plans will have to conform to these and other standards.

How do I know if my current insurance coverage is a grandfathered plan?

  • By law, your plan has to tell you if it is grandfathered.
  • Any individual plan that you purchase for the first time after March 23, 2010 is considered new and is NOT grandfathered.
  • If you start a new job at a company with a grandfathered plan, your coverage is grandfathered as well, even though you are a new plan participant.
  • The baseline is what your plan was when the reform law was signed on March 23, 2010.
  • If any of these changes occur after March 23, your plan is no longer grandfathered:
    • Increase in your share of health-care bills (coinsurance) by any amount.
    • Increase in co-pays or deductibles by more than medical inflation (typically 4-5%) plus 15%.
    • Elimination or significant reduction in benefits to treat certain conditions.
    • Switching to a new carrier (unless you work for a self-insured company).
    • If under an employer group plan, and your share of premiums rises more than 5% it is no longer grandfathered.

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