The Departments of Health and Human Services, Labor, and Treasury (collectively, the “Departments”) during the first half of the year issued guidance in the form of Frequently Asked Questions (the “FAQs”) on certain provisions that impact non-grandfathered group health plans. The FAQs provide additional, albeit in some cases scant, guidance on: (i) annual limits on deductibles; (ii) annual limits on out-of-pocket maximums; (iii) preventive care mandates; (iv) provider non-discrimination; and (v) clinical trials, which are discussed in turn below.
Annual Limits on Deductibles
The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the “Affordable Care Act” or “ACA”), imposes annual limits on deductibles for non-grandfathered group health plans for plan years and policy years beginning on or after January 1, 2014. The annual limit for deductibles for these types of plans will be $2,000 for self-only coverage and $4,000 for family coverage.
In FAQs About Affordable Care Act Implementation Part XII, Q&A 1 the Departments reiterate, as they have done in prior guidance, that the deductible limits do not apply to self-insured group health plans, large group employer plans or large group market insurers. The deductible limits apply only to group health plans and issuers in the small group market, and until future rulemaking is promulgated and effective, self-insured group health plans, large group employer plans or large group market insurers can rely on the Departments’ stated intention to apply the rules only to group health plans and issuers in the small group market.
Annual Limits on Out-of-Pocket Maximums
ACA also imposes annual limits on out-of-pocket maximums for all non-grandfathered group health plans, including self-insured and large group health plans. The expenses that apply for purposes of the out-of-pocket maximum limit include deductibles, coinsurance and copayments, but exclude premiums. The limit imposed by ACA is the limit for high deductible health plans coordinated with health savings accounts. For plan years beginning in 2014, the out-of-pocket maximum for self-only coverage may not exceed $6,350 and the out-of-pocket maximum for family coverage may not exceed $12,700. These amounts are adjusted for increases in the cost of living.
The Departments recognize that plans may utilize multiple service providers to help administer benefits (such as a third-party administrator for major medical coverage, a separate pharmacy benefit manager and a separate managed behavioral health organization). Because separate plan service providers may impose different out-of-pocket limitations and may utilize different methods for crediting participants’ expenses against any out-of-pocket maximums, the Departments recognize that processes will need to be coordinated, which may require new communications between service providers.
As a result of the coordination that may be required, in FAQs Part XII, Q&A 2, the Departments announced a special transition rule for the first plan year beginning on or after January 1, 2014, for plans that use more than one service provider to administer benefits. For such plans, for that first year only, the Departments will consider the out-of-pocket maximum limit to be satisfied if: (i) the plan complies with the out-of pocket maximum limit for its major medical coverage (excluding, for example, prescription drug coverage and pediatric dental coverage); and (ii) to the extent the plan or any health insurance coverage includes an out-of-pocket maximum on coverage that does not consist solely of major medical coverage (for example, if a separate out-of-pocket maximum applies with respect to prescription drug coverage), such out-of-pocket maximum does not exceed the dollar limits described above.
Preventive Services Mandate
As reported in our April 30, 2010 Navigating Health Care Reform Alert, ACA requires all non-grandfathered health plans to provide certain preventive services without imposing cost-sharing requirements effective for plan years beginning on or after September 23, 2010. In FAQs Part XII, Q&As 3 through 20, the Departments provide additional guidance on preventive services. Among other things, the FAQs clarify that:
- if a plan does not have any in-network providers to provide a particular required preventive service, the plan cannot impose cost-sharing if the preventive service is obtained out-of-network;
- if a colonoscopy is scheduled and performed as a screening procedure pursuant to the USPSTF recommendation, a plan may not impose cost-sharing for the cost of a polyp removal during the colonoscopy;
- plans must provide routine genetic counseling, evaluation, and testing for the breast cancer susceptibility gene if such treatment is determined to be reasonable and appropriate by a health care provider;
- if a vaccine is prescribed by a health care provider consistent with the AICP recommendations, a plan is required to provide coverage for the vaccine without cost-sharing;
- “well-woman” visits may entail more than one annual visit depending on a women’s health status, health needs and other risk factors; and
- plans must provide access to the full range of FDA-approved contraceptive methods (including over-the-counter contraceptives prescribed for a woman by her health care provider), not just oral contraceptives.
FAQs Part XII addresses numerous other preventive care issues. Non-grandfathered group health plans should be administered consistent with the guidance provided in the FAQs.
For plan and policy years beginning on or after January 1, 2014, ACA provides that non-grandfathered group health plans may not discriminate with respect to participation under a plan or coverage against any provider who is acting within the scope of the provider’s license or certification under state law. In FAQs About Affordable Care Act Implementation (Part XV), the Departments point out that this provision does not require that a group health plan or health insurance issuer contract with any health care provider willing to abide by the terms and conditions for participation established by the plan or issuer, and nothing prevents a group health plan, a health insurance issuer, or the Secretary from establishing varying reimbursement rates based on quality or performance measures.
The purpose of this non-discrimination provision is not entirely clear, and, unfortunately, in FAQs Part XV, Q&A 2, the Departments indicate that they do not intend to issue regulations on the provider non-discrimination rules in the near future. Until further guidance is issued, group health plans and insurers are expected to follow “a good faith, reasonable interpretation of the law.” The FAQs do, however, go on to provide that “[f]or this purpose, to the extent an item or service is a covered benefit under the plan or coverage, and consistent with reasonable medical management techniques specified under the plan with respect to the frequency, method, treatment or setting for an item or service, a plan or issuer shall not discriminate based on a provider’s license or certification, to the extent the provider is acting within the scope of the provider’s license or certification under applicable state law. This provision does not require plans or issuers to accept all types of providers into a network. This provision also does not govern provider reimbursement rates, which may be subject to quality, performance, or market standards and considerations.”
FAQs Part XV, Q&A 2 provides contact numbers where more information regarding the non-discrimination requirement may be obtained.
Coverage for Individuals Participating in Clinical Trials
For plan and policy years beginning on or after January 1, 2014, ACA requires non-grandfathered plans to cover participation in clinical trials for treatment of cancer and other life-threatening diseases or conditions for qualified individuals. With respect to such conditions, a plan may not: (i) deny the qualified individual participation in approved clinic trials; (ii) deny (or limit or impose additional conditions on) the coverage of routine costs for items or services provided in connection with participation in the trial; or (iii) discriminate against the individual based on participation in the clinical trial. For this purpose, a “qualified individual” is “generally a participant or beneficiary who is eligible to participate in an approved clinical trial according to the trial protocol with respect to the treatment of cancer or another life-threatening disease or condition; and either: (1) the referring health care professional is a participating provider and has concluded that the individual’s participation in such trial would be appropriate; or (2) the participant or beneficiary provides medical and scientific information establishing that the individual’s participation in such trial would be appropriate.”
In FAQs Part XV, Q&A 3, the Departments indicate that they do not intend to issue regulations on the clinical trial requirement in the near future. Until further guidance is issued, group health plans and insurers are expected to follow “a good faith, reasonable interpretation of the law.”
FAQs Part XV, Q&A 3 provides contact numbers where more information regarding the clinical trial requirement may be obtained.