Out-of-Pocket Maximums, Marketplace Guidance
On March 8, 2016, HHS published the final version of its 2017 Notice of Benefit and Payment Parameters. The Notice is issued each year as part of the Affordable Care Act (ACA). For the most part, the guidance is focused on the ACA Marketplaces and insurers offering qualified health plans. It does, however, include several items relevant to employers and group health plans, specifically:
Annual limits for cost sharing (out-of-pocket limits)
Marketplace eligibility notifications to employers
Marketplace annual open enrollment period
Small Business Health Options (SHOP) Exchange
Annual Limits for Cost Sharing: The annual out of pocket limits for plan years beginning on or after January 1, 2017 are $7,150 for individual coverage and $14,300 for family coverage. These cost sharing limits apply to in-network essential health benefits offered under non-grandfathered health plans, both fully and self-insured. Annual deductibles, in-network co-insurance and other types of in-network cost sharing accumulate toward the out-of-pocket limit, including prescription drug copayments. Not included are premium payments, out-of-network cost sharing and spending on non-essential health benefits.
Marketplace Eligibility Notifications to Employers: Beginning in 2017, the Marketplace will notify an employer as soon as possible when one of its employee’s first enrolls in subsidized Marketplace coverage. Since some employers may be liable for a penalty under the ACA’s employer mandate when an employee qualifies for a subsidized Marketplace coverage, this change to a more proactive notification process will hopefully provide employers with the opportunity to work with CMS in cases where an improper subsidy has been provided.
Marketplace Annual Open Enrollment Period: Open Enrollment in the Health Insurance Marketplace, Healthcare.gov, for 2017 and 2018 will take place from November 1, 2016 through January 31, 2017 and November 1, 2017 through January 31, 2018, respectively.
Small Business Health Options (SHOP) Exchange: Beginning in 2017, small employers electing coverage in the SHOP Exchange will have the option of “vertical choice,” offering plans across all metal levels (platinum, gold, silver and bronze) from one insurer. States who opt out of the vertical choice option will continue to offer employers the choice of selecting health plans that are available at one single metal level of coverage.
About The Authors. This alert was prepared for Benico, Ltd. by Stacy Barrow and Mitchell Geiger. Mr. Barrow and Mr. Geiger are employee benefits attorneys with Marathas Barrow & Weatherhead LLP, a premier employee benefits, executive compensation and employment law firm. They can be reached at sbarrow@marbarlaw.com or mgeiger@marbarlaw.com. This is a service to our clients and friends. It is designed only to give general information on the developments actually covered. It is not intended to be a comprehensive summary of recent developments in the law, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion. Benefit Advisors Network and its smart partners are not attorneys and are not responsible for any legal advice. To fully understand how this or any legal or compliance information affects your unique situation, you should check with a qualified attorney.
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