Compliance

The Affordable Care Act (ACA) presents many new compliance challenges that range from ensuring plan designs incorporate the required benefits to notifying employee’s about the public Exchange.

Prohibition on Lifetime & Annual Dollar Limits

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The Affordable Care Act prohibits grandfathered and non-grandfathered group health plans from imposing lifetime or annual limits on the dollar value of essential health benefits (EHB) regardless of whether such benefits are provided in or out-of-network.

Lifetime Limits

For plan years beginning on or after September 23, 2010, group health plans may not establish lifetime limits on the dollar value of EHB. However, plans may impose lifetime dollar limits on benefits that are not EHB if those limits are otherwise permitted under federal or state law.

Annual Limits

For plan years beginning prior to January 1, 2014 – annual limits on the dollar value of EHB were limited to the following:

  • $750,000 for plan years beginning on or after September 23, 2010 but before September 23, 2011
  • $1.25 million for plan years beginning on or after September 23, 2011 but before September 23, 2012
  • $2 million for plan years beginning on or after September 23, 2012 but before January 1, 2014.

For plan years beginning on or after January 1, 2014 – group health plans may not impose annual limits on the dollar value of EHB.  However, plans may establish annual dollar limits on benefits that are not EHB if those limits are otherwise permitted under federal and state law.  Additional information on EHB is available in our March 2012 Briefing, which is available below.

 

 

Additional Information
Health Care Reform: Essential Health Benefits Guidance
This Briefing outlines guidance from the Department of Health and Human Services on how to define Essential Health Benefits.
Essential Health Benefits