Healthcare reform: Embedded out-of-pocket maximum for family coverage
The Affordable Care Act (ACA) requires non-grandfathered health plans to include an annual limit on total enrollee cost sharing for essential health benefits (EHB). This annual limit is often referred to as an “out-of-pocket maximum” or “maximum out-of-pocket” (MOOP).
Recent guidance from the Department of Health and Human Services (HHS) and the Department of Labor (DOL) provides that, effective for plan years beginning on or after January 1, 2016, non-grandfathered health plans must apply the ACA’s self-only MOOP to all individuals, regardless of whether they have self-only or family coverage.
This guidance requires group health plans to embed an individual out-of-pocket maximum in the plan’s family coverage when the family out-of-pocket maximum exceeds the ACA’s out-of-pocket maximum for self-only coverage. This guidance applies to all non-grandfathered group health plans, including self-funded plans and insured plans of all sizes. However, it will likely have the biggest impact on high deductible health plans (HDHPs) because these plans have higher cost-sharing limits.