If You Like Your Health Plan, You Can Keep It, But…

Some changes in existing insurance plans can disqualify them from eligibility under Obamacare.

WASHINGTON, DC - FEBRUARY 04: U.S. Secretary of Health and Human Services Kathleen Sebelius speaks during the opening plenary of the National Health Policy Conference organized by The AcademyHealth February 4, 2013 in Washington, DC. Sebelius spoke on the Obama Administration's health policy priorities.  
National Journal
Clara Ritger
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Clara Ritger
Oct. 30, 2013, 2:07 p.m.

How much an in­sur­ance plan could change be­fore los­ing its grand­fathered status be­came a point of de­bate at Wed­nes­day’s House En­ergy and Com­merce hear­ing on Health­Care.gov.

Con­sumers can keep their ex­ist­ing health in­sur­ance plan if it qual­i­fies for grand­fathered status, which means that even if it isn’t com­pletely com­pli­ant with the cov­er­age re­quire­ments set down by the Af­ford­able Care Act, it hasn’t changed enough to be con­sidered a new plan.

Rep. Greg Walden, R-Ore., said the Health and Hu­man Ser­vices De­part­ment is­sued reg­u­la­tions that made it so people would not be able to keep their ex­ist­ing cov­er­age if their in­sur­ance com­pany made small changes to the plan.

HHS Sec­ret­ary Kath­leen Se­beli­us dis­agreed with Walden’s as­sess­ment and said in­surers had enough flex­ib­il­ity to make changes to pri­cing and cov­er­age and still qual­i­fy for grand­fathered status.

Mil­lions of Amer­ic­ans are re­ceiv­ing no­tices that their plans will not ex­ist in 2014 be­cause their cov­er­age is not com­pre­hens­ive enough. Re­pub­lic­ans have turned it in­to a talk­ing point, ar­guing that the pres­id­ent lied to the Amer­ic­an people when he said, “if you like your health plan, you can keep your health plan.”

The truth is, in or­der to re­tain grand­fathered status, a plan can­not make changes to coin­sur­ance, cost-shar­ing, or lim­its on an­nu­al be­ne­fits. The em­ploy­er con­tri­bu­tion to the premi­um can­not de­crease by more than 5 per­cent­age points. De­duct­ibles, lim­its on out-of-pock­et ex­penses, and co-pays can­not in­crease more than the med­ic­al price of in­fla­tion plus 15 per­cent­age points.

A plan also can­not elim­in­ate be­ne­fits or ac­cess to ser­vices for a par­tic­u­lar con­di­tion. Em­ploy­er-sponsored plans can­not change in­sur­ance car­ri­ers; however, if the em­ploy­er is self-in­sured but con­tracts with an out­side in­surer, they can change who they con­tract with and re­tain grand­fathered status. 

Health Af­fairs, a health policy journ­al, has is­sued a brief about the reg­u­la­tions sur­round­ing grand­fathered plans, found here.

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