Several important provisions of the health reform law will take effect this month. September 23, 2010 marks the six-month anniversary of the signing of the reform law. While you may not feel like celebrating that fact, it's important to know that several of the law's provisions will kick in on that date or shortly thereafter.
First, two caveats. The effective date of these changes varies with your plan. For example, if you are in a group plan that works on a calendar year basis beginning on January 1, then these changes take effect for you on January 1, 2011 -- the beginning of the next plan year after September 23, 2010. If you are in an individual plan that renews on March 1, then the changes take effect for you on March 1, 2011 -- the beginning of the next plan year after September 23, 2010.
Second, some provisions do NOT apply to "grandfathered' plans. As you will recall, President Obama promised that if you are happy with the plan you have, you can keep it. Well, this is how he kept that promise. If you have a plan that existed on March 23, 2010 and does not change in any substantial way (keep reading), it is a grandfathered plan. A plan loses its grandfathered status if it changes in one of the following ways:
(a) increased copayment of more than $5 or above medical inflation plus 15 percentage points;
(b) increased deductible above medical inflation plus 15 percentage points; increased out-of-pocket limit above medical inflation plus 15 percentage points;
(c) an increase in coinsurance rates;
(d) a decrease in the annual limit or adoption of a new annual limit after March 23, 2010;
(e) a decrease of more than 5 percentage point below the existing employer contribution rate as of March 23, 2010; or
(f) the elimination of all or substantially all covered benefits to diagnose or treat a particular condition after March 23, 2010.
Any new plan is NOT a grandfathered plan, so if your employer switches to a different insurance company, or if you buy a new individual policy after March 23, 2010, that plan is NOT grandfathered.
As I go through each of the changes that takes effect on September 23, 2010 or the beginning of the next plan year after that date, I will indicate which ones apply to grandfathered plans and which do not.
All of these provisions take effect on September 23, 2010 or the start of the next plan year after that date. This takes effect in every state, regardless of your insurance company, unless you are in a high risk pool. These rules apply only to plans sponsored by an employer or issued by an insurance company, not to high risk pools.
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