Grandfathered Provisions
Grandfathered status is available for a health plan that was providing coverage as of March 23, 2010 and has not been changed in any impermissible way (as detailed by federal regulations) since then. Grandfathering is available for some of the new market reform provisions, which were added to HIPAA. A high level summary of those requirements is included below. Grandfathering is not available for other Health Care Reform requirements, such as the Free Rider Penalty, changes to health FSAs and HSAs, etc. Note that HIPAA Exception Benefits are exempt from the requirements below – click here to learn more.
- Grandfathered and Non-Grandfathered Plans Must Comply *
- Pre-existing condition exclusions for children prohibited (2010)
- Lifetime limits prohibited (2010)
- Annual limits restricted (2010)
- Rescissions (canceling coverage retroactively) prohibited (2010)
- Must cover adult children to age 26 (special rule available for grandfathered plans) (2010)
- Waiting periods over 90 days prohibited (2014)
- Annual limits prohibited (2014)
- Pre-existing condition exclusions for adults prohibited (2014)
- Grandfathered plans must cover all children to age 26 (2014)
- Incentives for wellness participation increases to 30% (optional - 2014)
- Only Non-Grandfathered Plans Must Comply *
- Insured plans may not discriminate in favor of highly compensated individuals (2010)
- Must cover preventive care without cost-sharing (2010)
- Must allow individuals to choose their PCPs/pediatricians (2010)
- Must allow access to OB/GYN without referral (2010)
- Must provide direct access to/coverage for emergency services (2010)
- Must follow new internal and external review standards (2010)
- Insured, small group plans must cover all essential benefits (2014)
- May not discriminate against individuals in clinical trials (2014)
- Must comply with limits on deductibles (2014)
- Must comply with limits on out-of-pocket maximums (2014)
- May not discriminate against providers acting within the scope of their licenses (2014)
* 2010 requirements take effect the first plan year beginning on or after September 23, 2010. 2014 requirements take effect the first plan year beginning on or after January 1, 2014.
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Additional Resources
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Grandfathering Home Page
Overview of requirements, FAQs, and Hot Topics
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Notice Requirements
Applicable to grandfathered plans
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Documentation Requirements
Applicable to grandfathered plans
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Value of Grandfathering
A summary describing the value of being grandfathered
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Grandfathering Restrictions
A summary of the restrictions that apply if an employer wants to maintain grandfathered status
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American Fidelity Assurance Company does not provide tax or legal advice.
