Employer Toolkit

Healthcare Reform Toolkit for CoreSource clients

CoreSource clients started feeling the impact of PPACA in advance of their first plan renewal date on September 23, 2010. After this time, plan sponsors were required to make key decisions related to their plan, make the necessary changes to their plan documents, and communicate those changes to employees and dependents.

Information is key to understanding healthcare reform, and we try to provide as much of that as possible to our clients. Review the sections below to find information on the implications of PPACA, as well as tools and resources to help you make these important decisions.

Summary and Overview of PPACA

Grandfathered Status - To Keep or Not to Keep

Required Plan Document Changes

Required Notices for Plan Members

Tools and Additional Resources

Summary and Overview of PPACA

For an extensive overview of PPACA and how it relates to self-funded plans, we are providing:

  • A Comprehensive Guide to PPACA written by our team of government relations professionals (Updated April 2013)
  • An overview from Self Insurance Institute of America (SIIA)
  • A timeline of key provisions 

 

Grandfathered Status – To Keep or Not To Keep?

The first and most significant decision most plan sponsors had to make was whether to retain the plan’s grandfathered status. An August, 2010 study from Hewitt Associates found that 51 percent of self-funded employers expect to lose grandfathered status in 2011, and a full 90 percent expect to lose it by 2014. In order to help our clients make informed decisions about their own plans, CoreSource has developed a simple yet detailed modeling tool that uses each clients’ own claims data along with plan design specifics and other elements to create a snapshot of the potential financial impact of their grandfathering decision.

The CoreSource model produces the following results:

  • Estimates of the potential annual costs for plan changes required under health reform for:
    • All health plans
    • Non-grandfathered plans
  • Estimates of the potential cost savings from the maximum benefit plan changes allowed and still maintain the Grandfather Plan status
  • Projected plan costs per employee per month (PEPM) through 2014 (when more significant health reform changes are enacted) under two scenarios:
    • Maintain Grandfather Plan status based on maximum benefit coverage changes allowed and additional costs of required changes after 9/23/10
    • Complying with all required plan changes for Non-Grandfather Plans while reducing benefit plan coverage and employer contributions to meet the cost trend target by 2014.
  • Projected plan costs relative to the Cadillac Tax threshold limits by 2017

To have this model run on your plan, please contact your CoreSource Client Manager.

 

Required Plan Document Changes

Whether a plan remains grandfathered or not, significant changes will have to be made to the Plan Document to comply with PPACA. Here’s a quick look at some of the provisions that will apply for plans with renewal dates on or after 9/23/10:

PPACA Provisions effective for plan years beginning after 9/23/10

Applies to grandfathered plans

Applies to non-grandfathered plans

No lifetime benefit maximum limits

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v

Dependent covereage for adult children up to age 26

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v

No annual limits on “essential” benefits

v

v

Report value of employer-sponsored coverage on employee W2s

v

v

No discrimination in favor of highly compensated employees

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v

No pre-existing condition limitations for children under 19

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v

100% coverage of preventive care (in network)

 

v

No prior authorization for emergency services or higher cost sharing for out of network emergency services

 

v

Coverage of routine patient costs for clinical trials of life-threatening diseases

 

v

The CoreSource compliance team has drafted plan language to bring our clients into compliance with either scenario. For more information, please contact your CoreSource Client Manager.

 

Required Notices for Plan Members

Many provisions of PPACA require plan sponsors to provide notices to plan members, either in enrollment materials or in a summary plan description. Click on the links below for model notices from the Department of Labor.

Notices to be provided in enrollment materials (both notices must be provided whether or not a plan is grandfathered)

  • Model Notice for Coverage of Adult Children under age 26 – Plans must provide a one-time special enrollment period for adult children under age 26 whose eligibility for coverage previously ended or who were not eligible for coverage due to age. This enrollment period must begin on or before the date the plan year starts and last for at least 30 days.
  • Model Notice of Elimination of Lifetime Benefit Limits – Plans are required to give notice that any previous lifetime benefit maximum limits no longer apply. Plans must also provide members who lost their coverage as a result of lifetime limits with a special 30 day enrollment period.

Notices to be provided in summary plan documents:

  • Model Notice of Grandfathered Status – When a plan sponsor elects to maintain a plan’s grandfathered status, it must notify plan members accordingly.
  • Disclosure (not applicable to grandfathered plans) – informs members of their rights to seek care under plans that require the designation of a primary care physician (PCP). Most plans administered by CoreSource do not require the designation of a PCP, and thus would not be required to provide this notice.

PPACA also requires many new notices related to adverse benefit determination and external review. These notices will be provided to members by CoreSource on behalf of the plan sponsor.

If you would like to offer your employees an overview of healthcare reform provisions that may affect them, you can use this communication for grandfathered plans and this one for non-grandfathered.

 

Tools and Additional Resources

Review the materials below to determine the impact of healthcare reform on: