A new rule from the U.S. Department of Health and Human Services (HHS) addresses, among other things, the requirement under the Affordable Care Act that non-grandfathered group health plans limit annual out-of-pocket cost-sharing for coverage of essential health benefits under the plan. Under the rule, these out-of-pocket expenses may not exceed $8,150 for self-only coverage or $16,300 for family coverage in 2020.
Policies Renewed Under Extended Non-Enforcement Policy Must Comply by January 1, 2021
A previously extended non-enforcement policy which allows health insurance issuers, at their option, to continue group coverage that would otherwise be terminated or cancelled has been further extended to policy years beginning on or before October 1, 2020, provided that all policies come into compliance by January 1, 2021. Health insurance issuers that renew coverage under the extended non-enforcement policy are required to provide standard notices to affected small businesses for each policy year.
Coverage subject to the non-enforcement policy will not be considered to be out of compliance with key Affordable Care Act provisions, including:
The requirement to cover a core package of items and services known as essential health benefits;
The requirement that any variations in premiums be limited with regard to a particular plan or coverage to age, tobacco use, family size, and geography;
The requirements regarding guaranteed availability and renewability of coverage; and
The requirements relating to coverage for individuals participating in approved clinical trials.
Click here to review the extended non-enforcement policy.
DOL Rule Called ‘End-Run’ Around Affordable Care Act
A federal judge has ruled that two parts of the Department of Labor (DOL) rule expanding employers’ ability to join in association health plans (AHPs) violate ERISA. AHPs are group health plans sponsored by a group of employers. In June 2018, the DOL issued a rule allowing AHPs to offer coverage to some or all employers in a state, city, county, or multistate metro area, or to businesses in a common trade, industry, line of business, or profession in any area, including nationwide.
The March 28 federal court opinion stated that the rule was an “end-run” around the Affordable Care Act, and that the DOL exceeded its authority when it defined “employer” in the rule to include associations of disparate employers. The court also struck down a part of the DOL rule that expanded memberships in AHPs to working owners without employees.
The court directed the DOL to reconsider how the remaining provisions of the June 2018 rule are affected by the opinion. Further legal and regulatory developments are expected.
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