Understanding Grandfathered Plans

This week the Department of Labor's Employee Benefits Security Administration posted the following related to grandfathered health plans under the Affordable Care Act:

Fact Sheet, available at:
http://www.healthreform.gov/newsroom/keeping_the_health_plan_you_have.html

FAQs, available at: http://healthreform.gov/about/grandfathering.html

A couple key points that we, at TrueNorth, think you should keep in mind in reference to the above "Fact Sheet":

• Medical plans can undergo some modifications and still retain their grandfathered status, which exempts them from some of the new mandates (modifications listed under “Additional Consumer Protections…”).
• The exempted mandates are expected to increase a plan’s costs slightly (generally less than 2%-5%) and increase an employer’s reporting requirements (creating additional internal cost) if/when a plan loses its grandfathered status.
• Some mandates will still apply to all plans – even grandfathered ones (listed under “Protecting Patients’ Rights…”).
• It’s expected that small employer and individual plans will lose their grandfathered status more frequently than large employer plans since they tend to more frequently reduce their benefits and/or increase employee contributions in an effort to cope with rising costs.

That's it for now. Stay tuned - as always - for more as we hear and digest the information!