The Department of Health and Human Services has rolled out regulations governing health plans in effect prior to the passage of Obamacare. You know, the plans that “if you like it, you can keep it?”
The new regs will mostly affect the 170 million-plus Americans who carry employer-sponsored coverage. The vast majority of them (82 percent) are satisfied with their current coverage.
The new regs will make it tough for a lot of those folks to hold onto their current plans, even though the Department of Health and Human Services continues to claim otherwise. That because HHS is ready to revoke the “grandfathered” status of existing plans whenever an employer makes what it deems to be a “significant” change in terms of coverage. And the HHS regs show that common adjustments such as an increase in deductibles or co-pays or a reduction in benefits would be considered “significant.”
According to the regulations themselves, by 2013, 51 percent of existing employer-sponsored plans will no longer qualify as “grandfathered.” That’s the mid-range estimate—the percentage of plans that lose grandfathered status could range from 39 percent to as high as 69 percent.
And even if a plan retains grandfathered status, it may have to change to satisfy Obamacare requirement. For example, all plans will be required to dump any lifetime caps on coverage and to extend family plan coverage to “children” up to the age of 26.
As James Gelfand, health policy director for the U.S. Chamber of Commerce, explains, “What we are getting here is a clear indication that most plans will have to change…from an employer’s point of view that’s a bad thing. These changes, whether or not they’re good for consumers, are most certainly accompanied by a cost.”
Bottom line: Odds are that plan you like will be changed by 2013, whether you want it to or not.