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Regulators Confirm Embedded OOP Limit for 2016

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Regulators Confirm Embedded OOP Limit for 2016
Calendar17 September 2015

The Obama administration this week rebuffed requests to reconsider or delay controversial ACA guidance requiring all nongrandfathered health plans to limit an enrollee’s out-of-pocket (OOP) spending to ACA’s individual maximum for 2016, even in family coverage. While many employers originally expected this requirement to apply only in the small-group and individual markets, regulators announced in May their intention to enforce it on all nongrandfathered plans, even self-insured and large-group insured ones. This means employers’ nongrandfathered plans whose family annual OOP maximum for in-network essential health benefits exceeds $6,850 for 2016 must embed an individual OOP limit of this amount or less.

Proposed ACA rules would bar discrimination by insurers offering public exchange plans and entities receiving federal financial assistance. Issued September 3, the proposal would bar discrimination in providing and administering health insurance or related coverage on the basis of race, color, national origin, age, disability, or sex, including gender identity, pregnancy, and sex stereotyping. For example, insurance policies subject to the rule could no longer categorically exclude gender transition from coverage. Other protections address auxiliary aids and services for the disabled and language assistance for people with limited English proficiency.

The “Alliance to Fight the 40” and other supporters of repealing the ACA’s 40% excise tax on high-cost plans are cheering the fact that a bipartisan majority of the House is now cosponsoring legislation to repeal the tax. Lawmakers have signed onto either of two separate bills, one from Rep. Frank Guinta (HR 879) and another from Rep. Joe Courtney (HR 2050). The outlook for committee and full House action on the legislation is unclear at this point, but momentum is expected to increase with expected introduction of a Senate measure soon. Repeal will be an uphill climb, though, given the budget hole it would leave and likely opposition from many Senate Democrats and President Obama; other legislative relief may be offered if outright repeal of the tax stalls.

A House panel last week held a hearing on the ACA’s provision to change the definition of small group from 2-50 to 2-100 in 2016. The change – set to become effective on January 1 – would increase premiums for many formerly large groups when they are subjected to the ACA’s ban on age and gender rating restrictions and the mandate to cover essential health benefits, according to testimony from actuarial firm Oliver Wyman. Bipartisan House and Senate legislation (S 1099, HR 1624) that would let states choose whether to expand their small group markets to 100 employees has broad support and is not opposed by the Obama administration, but whether it can become law is unclear.

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