To keep your Grandfathered status under the new Health Care Reform Law, you'll have to limit your plan changes... And for what? To get out of having to abide by a few of the new rules. Is it worth it? Probably not. But you should know what you are choosing, and why. What Reforms Apply to All Plans, Including Grandfathered Plans? - Elimination of lifetime limits on essential benefits - Phase-out of annual limits on essential benefits by 2014 - Extending eligibility for dependents up to age 26* - Elimination of pre-existing condition limitations for children under age 19 - Elimination of all pre-existing condition limitations in 2014 - Limitation of benefit waiting periods to no more than 90 days in 2014 - Insurer rebates if minimum loss ratio standards not met (insured plans only) - Assessment of "Cadillac plan tax," if applicable - Assessment of employer mandate charge, if applicable What Reforms are 'Grandfathered' Plans Exempt From? - Cover immunizations and certain preventive care without cost sharing - Allow member choice of participating primary care physicians and pediatricians** - Allow direct access (no referral) to OB/GYN services** - Cover emergency services without pre-authorization or increased cost sharing if out of network** - Provide internal and external review processes for certain denied claims** - Eliminate discrimination in favor of highly compensated individuals - Prohibit discrimination based on participation in a clinical trial - Apply certain federal rating limitations in 2014 for small group plans (state rating rules will still apply) - Provide essential benefits in the small group market in 2014 - Abide by cost sharing and deductible limits in 2014 * Under PPACA, until 2014 grandfathered group health plans are not required to offer coverage to dependents who are eligible for employer coverage. ** Most major insurance carrier's group plans already provide these benefits. Are there disadvantages of remaining "Grandfathered"? Employers opting to grandfather existing health plans will be limited in their ability to shift cost increases: - Coinsurance percentage paid by participants cannot be increased. - Co-payments can increase only by limited amounts or percentages. - Increases in deductibles and out-of-pocket maximums are limited to medical inflation plus 15% from the March 23, 2010 level. - Employers cannot decrease premium contribution percentage by more than five percentage points from the March 23, 2010 level. Grandfathered plans will also entail increased administrative burdens for employers: - Employer must maintain records documenting terms of plan in effect March 23, 2010, including costs and contributions. - Multiple new notices regarding health plans are required by PPACA. - All benefit materials must clearly provide the "Grandfathered Status Model Notice". | 
