The Employee Benefits Security Administration (EBSA) has come down on the side of health plan sponsors in several newly posted answers to questions about the Affordable Care Act.
EBSA, an arm of the U.S. Department of Labor, has discussed topics such as application of the rules governing matters such as grandfathered health plans, rescissions and abuse of the mandatory preventive care coverage requirements in a list of answers to frequently asked questions (FAQs) about the Affordable Care Act, the legislative package that includes the Patient Protection and Affordable Care Act (PPACA).
EBSA officials say they developed the guidance together with officials responsible for Affordable Care Act implementation at the U.S. Treasury Department and the U.S. Department of Health and Human Services (HHS).
Some employers, trade groups and employer groups have wondered whether the departments will interpret the Affordable Care Act in draconian ways that will force insurers and employers to make absurd benefits decisions or expose them to the risk of facing severe penalties.
“The ongoing guidance the departments are providing reflects our approach to implementation, which emphasizes assisting (rather than imposing penalties on) plans, issuers and others that are working diligently and in good faith to understand and come into compliance with the Affordable Care Act, as well as our commitment to work with families and individuals to make it as easy as possible for them to obtain the protections and benefits of the new law,” officials at EBSA and the other agencies say in an introduction to the FAQs.
In the summer, for example, the agencies developed a list of 6 actions that could cause an existing health plan to lose grandfathered status and become subject to the full brunt of Affordable Care Act mandates.
The 6 actions includes elimination of benefits for a specific condition; an increase in the percentage cost of cost-sharing requirements, such as coinsurance rates; an increase in a deductible or out-of-pocket maximum by an amount that exceeds medical inflation plus 15 percentage points; an increase in a copayment by an amount that exceeds medical inflation plus 15 percentage points; a decrease in an employer’s contribution rate towards the cost of coverage by more than 5 percentage points; or imposition of annual limits on the dollar value of all benefits below specified amounts.
“Are there other changes to our existing plan/policy that we need to be concerned
could cause it to relinquish grandfathered status?” a commenter asks.