As soon as the provisions of the new health care laws were
introduced, my health insurance company sent me a letter stating
that my plan's preventive-care coverage will not change because
it has been grandfathered by the health care law. My insurer
hasn't covered preventive care and is using this "grandfather"
excuse to avoid paying for preventive-care visits and tests. Can
my insurer keep doing that?
The health care law did exclude "grandfathered" policies from
certain provisions, including the preventive-care requirements.
Grandfathered policies are group or individual policies that have
not changed their coverage or out-of-pocket costs substantially
since the health care law was passed on March 23, 2010. To qualify
for this status, the policies cannot have significantly raised
co-payment rates or the percentage of expenses the employee has to
cover or lowered the employer contributions to premiums, and they
cannot have raised deductibles significantly or tightened the
annual limit on the insurer's coverage. Plans that make any of
those changes lose their grandfathered status and must provide some
additional coverage. For more information about the definition of a
grandfathered plan, see the
Keeping the Health Plan You Have
factsheet.
It's a good idea to ask your employer or insurer whether your
plan continues to be grandfathered when you get your information
about next year's changes during open-enrollment season this fall.
Each year, more plans lose their grandfathered status. According to
the Kaiser Family Foundation's 2012 Employer Health Benefits study,
58% of firms offering health benefits reported that at least one of
the plans they offered in 2012 was a grandfathered plan (down from
72% of firms offering a grandfathered plan in 2011). Overall, 48%
of covered workers are enrolled in a grandfathered health plan in
2012, down from 56% in 2011.
And the number of grandfathered plans is continuing to shrink.
In a survey of large employers' health plans for 2013 conducted by
the National Business Group on Health, 57% of the employers said
that none of their health plans kept grandfathered status in 2012;
7% said they will drop grandfathered status in 2013; and only 27%
said they plan to keep grandfathered-plan status for existing
benefit options in 2013 (9% of employers said they didn't know yet
whether their plans will keep their grandfathered status in
2013).
As you noticed, the biggest difference between grandfathered and
nongrandfathered plans is the coverage for preventive care. All
health plans, except for grandfathered plans, must now provide
certain preventive-care benefits without any co-payments or
deductibles. See
Take Advantage of Expanded Preventive Care
Coverage
for details.
Grandfathered plans are also exempt from the new rules for
appeals and are not subject to the rule that insurers must provide
emergency care without requiring prior approval, even at an
out-of-network hospital (although you may need to pay
out-of-network costs). They are also exempt from new rules letting
you see an obstetrician-gynecologist or pediatrician without a
referral from a primary-care provider.
The requirements for grandfathered plans offered by an employer
are a bit different than they are for grandfathered individual
plans. No health plans, whether they are grandfathered or not, can
apply lifetime dollar limits to essential health benefits. And most
plans, except for grandfathered individual plans, must gradually
phase out annual limits in coverage, resulting in an annual
coverage cap of no less than $1.25 million for plan years starting
after Sept. 23, 2011; $2 million for plan years starting after
Sept. 23, 2012; and no annual limits on benefits after January 1,
2014. Grandfathered individual plans are not subject to these
annual-cap requirements.
Grandfathered individual plans also are not subject to the rules
requiring insurers to eliminate preexisting-condition exclusions
for children under 19 years old.
All plans offering dependent coverage must permit children up to
age 26 to remain on their parents' policy -- a key provision of the
health care law. Until 2014, however, grandfathered group plans do
not have to offer dependent coverage up to age 26 if the young
adult is eligible for group coverage outside their parents' plan --
even if their new employer's plan offers limited coverage at high
prices. See
Health Insurance for Adult Children
for details.
For more information on the rules, see the
Grandfathered Health Plans
factsheet at Healthcare.gov. For more information about health
insurance changes for 2013 -- and tips for picking the best plan
during open-enrollment this fall -- see
Make the Most of Health Insurance Changes for
2013
.