On May 10, 2010, the Departments of Labor, Health and Human Services and Treasury issued regulations implementing the Affordable Care Act by expanding coverage for adult children up to age 26. The benefits become effective for plan years beginning on or after Sept. 23, 2010. For calendar year plans, that will mean the provisions will become effective beginning Jan. 1, 2011.
Key elements include:
- Coverage Extended to More Children
- All Eligible Young Adults Will Have An Enrollment Opportunity
- Same Benefits/Same Price
But, the rules allow an exception for employer-sponsored health plans that were in existence on March 23, 2010 when President Obama signed the healthcare bill. In general, such health plans can exclude adult children of workers until 2014 if the children have access to insurance through another employer-sponsored health plan.
In addition, health care reform critics claim that that some families could pay a price if they seize the chance offered by the new healthcare law to keep children up to age 26 on their insurance policies. That is because until 2014, when health plans will be prohibited from charging higher premiums based on preexisting conditions, insurers in the individual market can take into account the young adult’s medical condition when setting the family’s premium. And, under certain circumstances, families could be required to pay extra to carry young adults on their policies.
Above all, please remember to ask for guidance and to double check the new regulations before modifying or adjusting the features of your health and wellness programs. Proceeding with caution may prevent you from losing your grandfathered status unintentionally.
For More Information
For more information about the impact of health care reform on your business, download the material from our recent webinar which covered all of the key points of the new health care reform bill, the Patient Protection and Affordable Care Act (PPACA).
- Aisling Partners Webinar Transcript & Downloads (May 4, 2010)
- Statement from Assistant Secretary Phyllis C. Borzi
- IRS Notice 2010-38 on Taxation of Health Care Benefits Provided With Respect to Children Under 27
Pay particular attention to the 2010 and 2011 timetable of events listed in the UHY Advisors Health Care Reform Overview to make sure you are in compliance with these new regulations, some of which are now in effect.
Please contact us for information or assistance.