September 24, 2010
In This Issue
You Say it's Your Birthday? PPACA Turns Six Months Old
NAIC Releases Its First Draft of the MLR Regulation, Visits the White House and Indicates It Will Seek Transition Relief
DOL Releases New Guidance on Some Key September 23 Reform Provisions
IRS Seeks Comments On 105(h)(2) Rules for Group Health Plans
NAHU Submits Comments on Claims Appeal IFR
Brokers Still Making a Difference
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DOL Releases New Guidance on Some Key September 23 Reform Provisions

On Monday, the Departments of Labor, Health and Human Services and Treasury released new interim guidance establishing an enforcement grace period for key aspects of the new claims and appeal procedure rules under PPACA. The interim guidance, which is welcome news for health plans and self-funded plans, provides for a “good faith” enforcement standard until July 1, 2011, so that health plans have more time to implement the regulations' very extensive requirements.

Also on Monday, the agencies issued responses to a number of FAQs concerning regulations that have been issued pursuant to PPACA, including questions relating to maintaining grandfather status, the new claims and appeals rule, coverage of dependent children to age 26, and out-of-network emergency services. Some key points from the new guidance include:

  1. It provides relief regarding grandfathering for insured group health plans based on a decrease in the employer's contribution rate. Specifically, an insured plan may continue to be grandfathered even if an employer decreases its contributions towards coverage by more than 5%, if the insurer obtains a representation as to the employer current contribution rate and the rate on 3/23/2010 and requires (in prominent contract language) that the employer notify it of any changes to the rate.
  2. It extends this rule to multiemployer plans, and provides that for self-funded multiemployer plans with no employee contributions (or fixed-dollar contributions), a decrease in the employer contribution rate will not alone cause loss of grandfathered status, if the employee contribution rate does not go up and there are no changes that would otherwise cause loss of grandfathered status.
  3. It states that guidance will be issued soon addressing circumstances where grandfathered plans may change insurers without loss of grandfathered status (a pleasant surprise).
  4. It provides that the 24-hour urgent care rule applies ONLY to claims—not appeals, which are still under the 72-hour window. Also, a new model notice is provided, as the first one contained mistakes.
  5. It provides that plans may limit health coverage for children until age 26 to only those children meeting the Code section 152(f)(1) definition of children, and may impose conditions for covering children not described in Code section 152(f)(1) (e.g. grandchildren and nieces/nephews) as dependents, "such as" requiring that they be dependents for income tax purposes.
  6. With respect to out-of-network emergency services, it provides that if state law prohibits balance billing—or if a plan or insurer is contractually responsible for any amounts balanced billed by an out-of-network provider—the plan is not required to pay the minimum amount otherwise required by the IFR.
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