Today President Barack Obama announced changes to the rules for existing health insurance plans as the full implementation of the Patient Protection and Affordable Care Act (ACA) approaches on January 1, 2014. In the wake of the public and political outcry over millions of cancellations of health insurance policies that would no longer comply with the requirements of the ACA, such as essential health benefits, no copayments for preventive health services, and annual and lifetime limits. Under the administrative “fix” announced by the President, health insurance plans who cancelled policies MAY decide to offer “grandfathered” policies for an additional year (2014), without complying with the ACA requirements. The health insurance plans would have to notify the covered individuals that the grandfathered policy would be available for another year but also explain how the policy fails to meet the requirements of the ACA AND that alternate, ACA-compliant plans are available through the health insurance marketplaces and the expansion of Medicaid. Health insurance plans would not be required to offer these grandfathered policies and state insurance commissioners may also decide that health plans may NOT do so within their state. Finally, only those currently covered by such policies (and received cancellation notices) would be able to purchase/use these grandfathered policies; the health insurance plans would not be able to continue to offer these policies to new applicants.
Ignatius Bau 