The Centers for Medicare and Medicaid Services (CMS) has announced that, after September 22, 2011, no new applications or requests for extensions of waivers from the Affordable Care Act’s annual limit restrictions will be considered. The announcement includes guidance to allow limited benefit, or “mini-med” plans, to apply for or renew a temporary waiver from annual limit restrictions through 2013.
The Affordable Care Act generally prohibits group health plans and health insurance issuers offering group or individual health insurance coverage from imposing lifetime or annual limits on the dollar value of health benefits, but allows “restricted annual limits” with respect to essential health benefits for plan years (in the individual market, policy years) beginning before January 1, 2014. No annual dollar limits on essential health benefits are permitted with respect to plan or policy years beginning on or after January 1, 2014 (except in the case of grandfathered individual market policies).
Extension of Existing Waivers and New Applications Accepted Through September 22nd
A group health plan or health insurance issuer that has received a waiver of the restricted annual limit of $750,000 for a plan or policy year beginning on or after September 23, 2010, but before September 23, 2011, may elect to extend its existing waiver until January 1, 2014 by following the procedures set forth in the new guidance. Additionally, a group health plan or health insurance issuer eligible to apply for a new waiver may apply for a waiver approval that will be effective until January 1, 2014 by following the procedures explained in the guidance.
The deadline for receipt of waiver extension forms and new waiver applications is September 22, 2011. Elections for a waiver extension or waiver applications received after September 22, 2011 will not be accepted. Plans or issuers that do not elect a waiver extension or that do not receive a waiver approval will be required to come into compliance with the annual limit restrictions.
Additional Requirements Imposed for Waiver Recipients
The newly published guidance also imposes new, more stringent disclosure requirements. Under the guidance:
- Health plans with waivers are required to tell consumers that their health care coverage is subject to an annual dollar limit lower than what is allowed under the law.
- Insurers must include the dollar amount of the annual limit along with a description of the plan benefits to which the limit applies.
- Plans also must show how the annual limit would affect a consumer who was hospitalized to help people understand how far their coverage will reach if they become seriously ill.
- Plans with waivers must attest annually to their compliance with the consumer disclosure requirement.
The guidance provides the exact language waiver recipients must use and the required font specifications. Written permission must be obtained from the Center for Consumer Information & Insurance Oversight (CCIIO) to use different language.
For More Information
To read the newly published guidance in its entirety, please click here. You may also view the press release here. More information about the annual limit waiver process is available on the CCIIO website. For additional requirements under the Affordable Care Act, please visit the HR360 section on Health Care Reform.