HHS amends grandfathered plan rules

November 16, 2010

After reviewing public comments, HHS has issued an amendment to the grandfathered plan rules in the PPACA. Companies can now change insurance companies and retain grandfathered status, as long as they keep employee costs and benefits “substantially” the same. Previously, the only change allowed was to third-party administrator, but after review the government concluded that not allowing employers to change insurance companies gave too much power to the carriers to increase rates on their corporate customers. This welcome change gives employers a little more breathing room to find the best value for their employee benefits without losing grandfathered status.

EBN has a pretty good summary of the new ruling.  You can find the actual ruling here; scroll down until you see this section, where you can dowload a .pdf of the ruling.

EMPLOYEE BENEFITS SECURITY ADMINISTRATION

RULES

Group Health Plans and Health Insurance Coverage:

Status as a Grandfathered Health Plan Under the Patient Protection and Affordable Care Act

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