Question of the Quarter: GrandFathered Status
Question: How do I determine if my plan can keep its grandfathered status?
Answer: You can ask yourself a few questions to determine whether or not your plan can remain grandfathered.
When you compare your plan that was in effect on March 23, 2010, will there be or has there been:
- A decrease of more than 5 percent in your contribution to the coverage?
- An elimination of a benefit to diagnose or treat a particular condition?
- Any increase in percentage in a member cost-sharing requirement, such as coinsurance?
- Any increase in a fixed copay by more than the greater of Consumer Price Index (CPI1) plus 15 percentage points or $52?*
- An increase in deductibles or out-of-pocket limits by more than CPI plus 15 percentage points?*
- An addition or decrease of an annual limit (except to replace an overall lifetime limit3)?
- A business restructuring in order to avoid loss of grandfathered status?
- If you answer "yes" to any of these questions, it is likely that your plan will not remain grandfathered.
What should I do if my plan will keep its grandfathered status?
If your plan meets all of the grandfathering requirements and you are interested in maintaining your plan's grandfathered status, you must certify each of your plans that qualify for grandfathered status within thirty (30) days prior to your renewal. Your client relationship manager will provide you with a form to make this certification.
In renewing your coverage, Meritain Health will assume that a plan does not intend to maintain its grandfathered status unless you certify at the time of renewal each of the plans that qualify for grandfathered status.
Whom can I contact if I have questions?
You can contact your client relationship manager with questions.
Compliance Quarterly is provided as an informational tool. It is recommended that plans consult with their own experts or counsel to review all applicable federal and state legal requirements that may apply to their group health plan. By providing this publication and any attachments, Meritain Health is not exercising discretionary authority over the plan and is not assuming a plan fiduciary role, nor is Meritain Health providing legal advice.
1. Based on the overall medical care component of the Consumer Price Index for All Urban Consumers, unadjusted (CPI), published by
the Department of Labor using the 1982 - 1. using the 1982 - 1984 base of 100.
2. Adjusted for inflation.
3. Permitted only if the plan did not already have an annual limit on March 23, 2010, and the new annual limit must not be lower than the prior lifetime limit and is subject to regulatory minimums.
* Your client relationship manager has access to a tool that can help you determine what increases are allowed without losing your grandfathered status.