Understanding the Two Separate ACA Delays

French novelist and critic – Jean-Baptiste Alphonse Karr – famously said (originally in French and translated to English in the mid 1800’s) – “the more things change, the more they remain the same”.  Based on recent news in Nebraska, relative to the roll out of the Affordable Care Act (ACA), aka Obamacare, I am going to reverse Mr. Alphonse Karr’s famous quote to say – “the more things remain the same, the more they change”!  If you’re not in Nebraska, keep reading because this week’s blog post addresses the allowance of what now amounts to a nearly three year delay of several key provisions* of the ACA…for some.

Barely more than a month ago, the White House granted a two year extension to the previously announced one year “transition relief”, allowing individuals and employers with fewer than 50 employees to “keep the plans they liked”.  (See – http://sstevenshealthcare.blogspot.com/2014/03/aca-transition-reliefdelay-extendedmaybe.html )  This meant that several ACA provisions* originally set to take effect as plans began or renewed on or after January 1, 2014, could be delayed nearly three years.

For Nebraskans:
Last week (April 30, 2014), the Director of the Nebraska Department of Insurance issued a notice (click – http://www.doi.nebraska.gov/notices/notc2014/notice02.pdfreversing a previous ruling issued on March 24, 2014, which indicated Nebraska would NOT be allowing the additional two year delay.  Based on this reversal, health insurers issuing individual and small group (under 50 employees) coverage in NE will now be allowed to delay the implementation of several Affordable Care Act (ACA) provisions, to October 1, 2017, based on plan anniversary dates. 

For Iowans:
Iowa initially made the decision to allow the two year delay on April 16, 2014 (click – http://www.iid.state.ia.us/node/8171674).  So like NE, health insurers issuing individual and small group coverage in the state of IA will be allowed to delay the implementation of several ACA provisions until 10/1/17, based on each case’s anniversary date.

For All Other States:
Much like the ACA related issues of Exchanges/Marketplaces and Medicaid expansion, each State must decide whether they are going to allow insurers to act on the delays.  I recommend “googling” your state’s insurance department, and looking at the posted notices, bulletins, press releases, etc., to determine your state’s position relative to the transitional relief and delays.
IMPORTANT: Remember that there were two separate and distinct delays: 1. the November 14, 2013 announced delay affecting case’s renewing between January 1, 2014 and October 1, 2014; and 2. the March 5, 2014 announced delay affecting case’s renewing on or before October 1, 2016.

Here are some important aspects to the transitional relief:

  • The transitional relief/delays issued by the White House do not compel insurers to facilitate the delayed provisions.  Rather, each insurer offering individual and small group coverage must decide whether they are going to delay, and then make all the necessary filings, changes, communications, offers, etc.
  • States can opt to adopt only the 11/14/13 delay, only the 3/5/2014 delay, or both.
  • States can opt to apply the delays to the individual market only, the small group market only, or both.
  • States can opt to allow large groups (50+ employees) that currently purchase coverage in the large group market and subsequently are redefined as small group (under 50 employees) effective January 1, 2016, the option of renewing with the transitional relief.  Such groups must, again, renew on or before 10/1/16 in order to be eligible for the transitional relief.
  • Affected insureds and groups could potentially delay ACA compliance with the affected provisions* as far out as October 1, 2017, based on their anniversary/renewal date.  Remember, the delays extend to policy years beginning on or before October 1, 2016.
  • The Centers for Medicare and Medicaid Services (CMS) issued an “insurance standards bulletin” on March 5, 2014 formally outlining the White House’s offer of the two year delay. Click here to access this bulletin – http://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/transition-to-compliant-policies-03-06-2015.pdf
  • The delay is ONLY available from the carrier an affected insured or group is insured through presently.  An insured or group will not be able to change insurers and obtain a “delayed ACA compliant plan”.

*  The specific ACA provisions affected by the transitional relief/delays relate to:

  1. health insurance premiums (modified community rating)
  2. guaranteed availability of coverage
  3. guaranteed renewability of coverage
  4. prohibition of preexisting condition exclusions or other discrimination based on health status, with respect to adults (age 19 and over), EXCEPT WITH RESPECT TO GROUP COVERAGE
  5. prohibition of discrimination against individuals based on health status, EXCEPT WITH RESPECT TO GROUP COVERAGE
  6. non-discrimination in health care
  7. comprehensive health insurance coverage (10 essential health benefits)
  8. coverage for participation in approved clinical trials
  9. single risk pool requirement

Forgive me if I sound like a broken record, but…STAY TUNED!