March 12, 2013
New regulations were issued by the Department of Health & Human Services (HHS) on February 20, 2013 outlining rules for employers with for 50+ full time employees (FTE). This included the minimum value calculator, which will be used to decide if a plan covers 60% of services, meeting the minimum value requirement of ACA. This ruling also set an annual cost-sharing limit for employees of large group plans.
Minimum Value Calculator - The minimum value calculator is designed to help large employers determine if their health plan meets the minimum essential coverage requirements under ACA. If a plan does not meet minimum value, and is not deemed affordable, the employer may face penalties. A plan meets the minimum value test if its share of the total allowed cost of benefits provided is at least 60%. The calculator and information about its use can be found at http://cciio.cms.gov/resources/regulations/index.html#pm.
Annual Cost Sharing Limits – New annual cost-sharing limits will be imposed on all large employer group plan years starting on and after January 1, 2014, including self-funded plans. These limits are as follows:
1) Limits what an enrollee pays for deductibles, coinsurance, and copays for the year.
2) The annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) do not exceed $6,350 for self-only coverage or $12,700 for family coverage.
3) Requirement that all in-network covered services must count toward the new annual out of pocket maximum.
Transitional Rule - This makes allowances for the application of the out of pocket maximum rule for group health plans with separate out of pocket maximums for different benefits when those benefits are administered by different service providers. An example of this would be major medical & pharmacy. This rule provides that for 2014, as long as the major medical coverage, including mental health and substance abuse, out of pocket maximum does not exceed the ACA limit, and no other coverage independently exceeds that limit, the group will be in compliance of the law.