July 11, 2014 — The Patient Protection and Affordable Care Act (PPACA) defines a grandfathered healthcare plan as those, “that were in existence on March 23, 2010 and haven’t been changed in ways that substantially cut benefits or increase costs for consumers.”
There are two types of grandfathered plans: job-based and individual. According to Healthcare.gov, the two are distinguished as follows:
- “Job-based grandfathered plans can enroll people after March 23, 2010 and still maintain their grandfathered status. They can do this as long as the plans haven’t been changed in ways that substantially cut benefits or increase costs for consumers, notify consumers with these policies that they have a grandfathered plan, and have continuously covered at least one person since March 23, 2010.”
- “Individual grandfathered plans can’t newly enroll people after March 23, 2010 and have that new enrollment be considered a grandfathered policy. But insurance companies can continue to offer the grandfathered plans to people who were enrolled before that date. An insurance company can also decide to stop offering a grandfathered plan. If it does, it must provide notice 90 days before the plan ends and offer enrollees other available coverage options.”
As a result, a clinic could have some patients with plans that are grandfathered and other patients with the same insurer whose plans are not grandfathered depending on when they enrolled. Patients can determine if their plan is grandfathered by contacting their benefit administrator or reviewing materials that describe plan benefits.
Plans subject to PPACA must end lifetime coverage limits and arbitrary cancellations of coverage, cover adult children up to age 26, provide a Summary of Benefits and Coverage (SBC) and hold insurance companies accountable to spend an appropriate percent of premiums on care versus administrative costs.
Unless mandated by state law, grandfathered plans do not have to: remove annual limits on care, cover preventive care for free, guarantee the right to appeal, protect a patient’s choice of doctor and access to emergency care or be held accountable through rate review. You may find it helpful to question payers to determine what benefits and protections grandfathered plans offer when verifying benefits. For questions, email InsInfo@acatoday.org.
