Government Releases Final Interim Guidance on Several PPACA Provisions

The Departments of Health & Human Services, Labor, and Treasury issued new regulations that better define the following PPACA provisions.  These provisions are effective for all plan years beginning AFTER 9-23-10.

No Pre-Existing Condition Exclusions for Anyone Under Age 19  

Plans are prohibited from denying coverage to anyone under the age of 19 based on a pre-existing condition. This ban includes both benefit limitations and coverage denials. These policies apply to all individual market and group health insurance plans. The requirement will be extended to all ages starting in 2014. Grandfathered individual plans are exempt from this requirement.

No Arbitrary Rescissions of Insurance Coverage

Insurers and plans will be prohibited from rescinding coverage – for individuals or groups of people, except in cases involving fraud or an intentional misrepresentation of material facts

No Lifetime Dollar Limits on Coverage

 Insurers and employers are prohibited from imposing lifetime dollar limits in all health plans and insurance policies issued or renewed on or after September 23, 2010.

Restricted Annual Dollar Limits on Coverage
The rules will phase out the use of annual dollar limits on “essential health benefits” over the next three years until 2014 when the Affordable Care Act bans them for most plans. The limits can only apply to essential health benefits; however, the rule does not provide any further detail on the definition of “essential health benefits” beyond that provided in the law.

• Plans issued or renewed beginning September 23, 2010, will be allowed to set annual limits no lower than $750,000
• Beginning September 23, 2011, minimum limit will be raised to $1.25 million
• Beginning September 23, 2012, minimum limit will be raised to $2 million
• Beginning January 1, 2014, all annual dollar limits on coverage of essential health benefits will be prohibited

These limits apply to all employer plans and all new individual plans, not grandfathered plans.  For more details and clarification, please refer to the HHS website at www.healthreform.gov.