#1. Determine if health care reform rules apply to your plan(s).

  • Apply to most group health plans.
  • Do not apply to retiree-only group health plans.
  • Do not apply to limited scope dental or vision plans.
  • Do not apply to specified disease plans.

#2. Decide if your plans can and should be grandfathered.

  • In effect on March 23, 2010?
  • Applies to each benefit package.
  • Certain market reform rules apply whether or not grandfathered.
  • Certain cost sharing limits required to remain grandfathered.
  • Exempt from certain coverage and benefit changes if grandfathered.
  • Exempt from new claims procedures if grandfathered.

#3. Adopt design changes that apply whether or not plans are grandfathered.

  • Expansion of coverage to adult children to age 26.
  • Elimination of lifetime maximums on essential health benefits.
  • Phase out of annual limits on essential health benefits.
  • Elimination of certain pre-existing condition limitations.
  • Prohibition on rescissions of coverage.

#4. Recognize the benefit changes you can make and remain grandfathered.

  • Changes to comply with health care reform or other federal or state law.
  • Benefit increases.
  • Add new hires or new enrollees.
  • Change TPA.

#5. Understand the benefit changes you cannot make and remain grandfathered.

  • Issued a new policy, certificate, or contract of insurance.
  • Eliminate all or substantially all benefits for a condition, including necessary elements to diagnose or treat.
  • Plans without annual or lifetime limits cannot add an annual limit, annual limits that
  • are less than existing lifetime limits cannot be added, and existing annual limits may
  • not be decreased.

#6. Appreciate the cost sharing limits that apply to grandfathered plans.

  • No coinsurance increases.
  • Increases in deductible and out-of-pocket limits and co-pays are limited.
  • Decreases in employer contributions are limited.

#7. Consider the new coverage and benefit rules that apply to non-grandfathered plans.

  • First dollar preventive care.
  • Emergency care without pre-authorization and out-of-network emergency care without increased cost sharing.
  • Selection of any primary care provider and pediatrician.
  • Access to OB/GYN without referral.

#8. Comprehend the new internal claims procedures that apply to non-grandfathered plans.

  • Strict adherence to regulatory requirements.
  • Non-English notices required in certain circumstances.
  • Required content of notices increased.
  • 24 hour notice on urgent care claims.
  • Flesh out full and fair review.
  • No conflicts.
  • Concurrent care reduction limits.
  • Adverse benefit determinations include rescissions.

#9. Understand the new external appeals procedures that apply to non-grandfathered plans.

  • Two types, state and federal.
  • Federal applies to self-insured ERISA governed plans.
  • If state external review process is available, fully-insured plans must comply. If not, fully-insured plans must comply with the federal process.
  • If the state external process applies to plans not governed by ERISA, those plans must comply with the state process. If not, those plans must comply with the federal process.
  • Two safe harbors.
    • Voluntary compliance with available state external process.
    • Meet the criteria for standard and expedited external appeals.
  • Standard external appeal.
    • Four months to request review.
    • Preliminary review by plan.
    • Referral to an independent review organization (IRO).
    • Detailed contractual provisions with IRO.
    • Thorough IRO review within 45 days.
    • Immediate provision of benefits if reversed.
  • Expedited external appeal.
    • Same steps as standard.
    • IRO decision in 72 hours.

#10. Use cost containment measures to offset increased group health plan costs.

  • 2011 average expected medical inflation is 8% to 9%.
  • Consider benefit reductions in plans not subject to health care reform.
  • Consider restructuring plans to avoid health care reform.
  • Begin or enhance wellness programs.
  • Create disciplined, systematic and automated model vendor contract review processes.
  • Negotiate cost plus pharmacy benefit manager contracts that fully account for all discounts, rebates and other monies paid by drug companies.