Healthcare Reform – Employer Action
The Patient Protection and Affordable Care Act (PPACA) otherwise known as “healthcare reform” is upon us. As we approach the end of 2010 and move into 2011, there are healthcare reform changes that, as the employer, you need to be aware of.
- January 1, 2011: Regardless of your plan year, if you offer FSAs, HSAs, or HRAs, over-the-counter medications can no longer be purchased through these plans without a prescription. There are some exceptions so please contact VISICOR for more information.
- Grandfathering: For all plan year renewals after September 23, 2010, special consideration and plan analysis must be done in order to determine your Grandfathered status. Although there are mandated changes being implemented for all plans, a Grandfathered plan will receive certain allowances. However, maintaining Grandfathered status has strict compliance requirements so careful consideration must be given as to the value of maintaining a Grandfathered plan.
- Healthcare Reform – Mandated Plan Changes: The PPACA requires ALL plans effective September 23, 2010 and beyond to meet the following requirements (including those plans that are Grandfathered):
- Adult Children Coverage: Group health plans that provide dependent child coverage will be required to cover adult children until the age of 26. Grandfathered plans may exclude adult children who are eligible for coverage under another employer-based health plan (other than one of a parent) until 2014.
- Restrictions on Lifetime and Annual Limits: Group health plans may no longer set lifetime limits on “essential health benefits.” It is possible that “restricted annual limits” on essential health benefits will be permitted until 2014, if the Secretary of HHS defines which such limits are permitted. Starting in 2014, annual limits on essential benefits are prohibited.
- Pre-existing Condition Prohibitions: All group health plans are prohibited from applying pre-existing condition limits for children under 19.
- Policy Rescissions: All group health plans and insurers are prohibited from rescinding coverage (except in limited acts of fraud or intentional misleading representation of facts).
- In addition to the regulations listed above, if your plan is NOT Grandfathered, you will need to meet additional requirements which include the following:
- Preventive Care Coverage: All group health plans are required to provide coverage for preventive services as defined in the new law and are prohibited from imposing cost sharing requirements on such items or services.
- Internal/External Appeals: Group health plans must have an “effective” internal and external appeals process for coverage determinations and claims and must continue coverage until appeals process is resolved.
- Non-discrimination for Fully-Insured Plans: Insured group health plans may not discriminate in favor of highly compensated individuals under Internal Revenue Code Section 105(h). This provision previously applied to self funded plans only, which is why most executive medical plans were funded on a fully insured basis.
- Emergency Services: Must be covered without prior authorization and treated as in-network.
- Choice of Providers: Must allow the plan member to designate a child’s pediatrician as the primary care provider and must not require authorization or referral for a participating OB-GYN.
For more information on anything outlined above, please contact VISICOR at www.visicor.net or call us at 281.824.3124 so that we can be of assistance.
The VISICOR Compliance Team