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Health Plans Impacted by ACA Cost-Sharing Limits

Learn which health plans are impacted by the Affordable Care Act's cost-sharing limits --- and how.

Image courtesy of Vichaya Kiatying-Angsulee / FreeDigitalPhotos.net

Under the Affordable Care Act (ACA), certain health plans must comply with cost-sharing limits with respect to their coverage of essential health benefits. These limits include an overall annual limit (or an out-of-pocket maximum) and an annual deductible limit.

Recently, the Department of Health and Human Services (HHS) released a final rule that clarifies which plans are subject to these cost-sharing limits. Below is a summary to help you understand what was issued.

Annual Deductible Limit

  • The annual deductible limit applies to health plans offered in the small group market.
  • The annual deductible for a health plan in the small group market may not exceed $2,000 for self-only coverage and $4,000 for family coverage.
  • For plan years beginning after 2014, the annual deductible limits will be increased by the “premium adjustment percentage” which is set annually by HHS.

Out-of-pocket Maximum Limit

  • The out-of-pocket maximum limit applies to all non-grandfathered health plans. For example, this includes self-insured health plans and insured health plans of any size.
  • Annual limits are placed on total enrollee cost-sharing for essential health benefits.
  • Once the limitation is reached for the year, the enrollee is not responsible for additional cost-sharing for essential health benefits for the remainder of the year.
  • The cost-sharing limit is tied to the enrollee out-of-pocket maximum for HSA-compatible high deductible health plans. For 2013, the HDHP out-of-pocket maximum cannot exceed $6,250 for self-only coverage and $12,500 for family coverage. Amounts for 2014 are expected to be released by the IRS in the spring of 2013.

Additional Information

For additional information on these cost-sharing limits, I’m happy to direct you to a resource that has been put together by HHS and the Treasury. Click here to access their collection of frequently asked questions regarding these limits.

Also, for more information on health care reform and its impact on your business, I invite you to register for our March 21st seminar on the topic of “Employer Responsibilities under Health Care Reform.”

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Posted in: Benefits and Insurance, Legislation

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