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Feds may add wraparound plans

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The Obama administration may create a new type of benefit program for employers that send some workers to the individual exchanges to get health coverage.

A “limited wraparound plan” would give employers a way to beef up the benefits of some workers who get their coverage from an individual exchange rather than enrolling in the employer’s group health plan.

The U.S. Treasury Department, the U.S. Labor Department and the U.S. Department of Health and Human Services have included the wraparound plan proposal in a package of draft regulations.

The package is set to appear in the Federal Register Tuesday. Comments would be due 60 days after the official publication date.

The agencies have listed Amy Turner, Beth Baum, Karen Levin and Jacob Ackerman as the best sources of information about the draft.

Officials developed the regulations to explain how Patient Protection and Affordable Care Act provisions affect one types of “excepted benefits” — benefits that need not comply with the PPACA and Health Insurance Portability and Accountability Act group health plan rules, like the minimum medical loss ratio rules.

To keep benefits like dental benefits and vision benefits from coming under PPACA, an employer must offer the benefits separately from any group health plan. The employer must also charge a separate premium for the excepted benefits.

Some employers provide dental and vision plans along with health plans, without charging workers extra. The employers complained that they might have to start collecting small premiums just to keep their dental and vision plans from becoming PPACA plans.

The federal agencies have proposed letting employers keep the self-insured dental and vision benefits out from under PPACA without having to collect separate premiums.

The federal agencies also have made good on previous promises to clarify the rules stating how sponsors of employee assistance plans can keep the EAPs from becoming PPACA plans.

In the section on limited wraparound plans, the agencies talk about strategies for keeping the plans from giving employers a way to drop their group health plans and send all workers to the individual health insurance exchanges.

To offer a wraparound plan, an employer would have to offer a good group health plan. The employer could offer the wraparound plan benefits only to workers who bought “qualified health plan” coverage from an exchange because they found that the group health coverage was unaffordable.

An employer could use a wraparound plan to give workers with QHP coverage benefits similar to what workers in the group health plan have.

The cost of the wraparound coverage would have to be 15 percent or less of the cost of the group health coverage.

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