Under the Patient Protection and Affordable Care Act (PPACA), group health plans or issuers of insurance coverage (typically, insurers) must provide certain notices to health plan participants, and in some cases, to all employees. For most plans—those that are calendar year plans—these obligations must be met on or before January 1, 2011.
What does this mean for employers? As a practical matter, employers have the responsibility for providing notices that their group health plan is obligated to provide. While plans and insurers both have obligations to provide the notices described below, employers should not rely on insurers to provide the notices. Taking a proactive approach avoids any question about compliance.
All plans must provide the following notices:
- Notice of dependent coverage for children up to age 26.As of January 1, 2011, if a plan covers dependent children, it must cover such children up to the age of 26. A notice of this right must be provided, along with an opportunity for children who had previously aged out of coverage or who did not enroll because they were too old under the prior plan to elect coverage. The parent of a child who makes such an election is also entitled to enroll if he or she is otherwise eligible for enrollment. The Department of Labor (DOL) has a model notice available for use that can be found on its website. The notice will need to be tailored for an employer’s individual use and to provide for the opportunity for a child’s parent to elect enrollment if the child does. The notice must be sent to all employees, not just current plan participants. Because the right to coverage for those electing coverage must begin January 1, 2011, the notice should be sent out by December 1, 2010. The notice may accompany other notices or open enrollment materials, but it must be prominent.
- Notice of lifetime essential benefit limit prohibition.As of January 1, 2011, plans are prohibited from having any lifetime limits on “essential benefits.” Additionally, plan participants who previously maxed out on essential benefits must be given the opportunity to enroll in the plan. DOL also has a model notice available for use, which can be found on its website. The notice should be revised to make reference to “essential benefits,” not just “benefits.” Lifetime limit notices will need to be tailored for an employer’s individual use and should be sent to all employees. Because the right to coverage for those electing coverage must begin January 1, 2011, the notice should be sent out by December 1, 2010. The notice may accompany other notices or open enrollment materials, but it must be prominent.
Grandfathered plans are those plans that are able to opt out of some of the PPACA requirements. To determine whether your plan is grandfathered for the upcoming calendar year, you should consult with your applicable insurer(s) and your legal counsel. Plans that wish to claim grandfathered status must, among other things, provide notice of the plan’s grandfathered status. The notice must be included in any plan materials provided to enrollees (during open enrollment or otherwise) or individuals who are already plan participants describing the benefits provided under the plan. DOL has issued a model notice that can be found on its website.
Non-grandfathered plans must also provide the following:
- Notice of participants’ rightsto choose a primary care provider or pediatrician when the plan requires participants to designate a primary care physician.
- Notice of participants’ rightsto obtain obstetrical or gynecological care without prior authorization.
Model DOL language can be found on its website. These notices must be provided whenever the plan provides an enrollee or a plan participant with a summary plan description or other similar description of benefits under the plan.
- Employers should immediately determine whether its plan(s) will be grandfathered by contacting applicable insurer(s) and consulting legal counsel.
- Employers should promptly begin drafting the required notices. Consulting with legal counsel can ensure that the notices employers send out are appropriately tailored to the employer’s circumstances and fulfill statutory obligations.
If you would like additional information about the PPACA notices, or about employment law matters in general, contact Meg Vergeront at 608.259.2663 or firstname.lastname@example.org.