Table Of ContentALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
Category Question Answer FAQ Title Agency Site
Compliance Q1. Under the A1. The Departments are working ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Affordable Care Act, together with employers, issuers, States, Implementation act-Sheets-and-
there are various providers and other stakeholders to help FAQ #1 FAQs/aca_implementation_faqs.html
provisions that apply them come into compliance with the
to group health plans new law and are working with families
and health insurance and individuals to help them understand
issuers and various the new law and benefit from it, as
protections and intended. Compliance assistance is a
benefits for high priority for the Departments. Our
consumers that are approach to implementation is and will
beginning to take continue to be marked by an emphasis
effect or that will on assisting (rather than imposing
become effective penalties on) plans, issuers and others
very soon. What is that are working diligently and in good
the Departments’ faith to understand and come into
basic approach to compliance with the new law. This
implementation? approach includes, where appropriate,
transition provisions, grace periods, safe
harbors, and other policies to ensure that
the new provisions take effect smoothly,
minimizing any disruption to existing
plans and practices.
Grandfathered Health Q2. After the A2. The Departments have determined ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans interim final that, until the issuance of final Implementation act-Sheets-and-
regulations on regulations, they will not treat an FAQ #1 FAQs/aca_implementation_faqs.html
grandfathered health insured group health plan that is a
plans were issued, grandfathered plan as having ceased to
some issuers be a grandfathered health plan
commented that they immediately based on a change in the
do not always have employer contribution rate if the
the information employer plan sponsor and issuer take
needed to know the following steps:
whether (or when) an Upon renewal, an issuer requires a plan
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
Category Question Answer FAQ Title Agency Site
employer plan sponsor to make a representation
sponsor changes its regarding its contribution rate for the
rate of contribution plan year covered by the renewal, as
towards the cost of well as its contribution rate on March
group health plan 23, 2010 (if the issuer does not already
coverage. (Generally have it); and
, the interim final The issuer’s policies, certificates, or
regulations provide contracts of insurance disclose in a
that a group health prominent and effective manner that
plan or health plan sponsors are required to notify the
insurance coverage issuer if the contribution rate changes at
will cease to be a any point during the plan year.
grandfathered health For policies renewed prior to January 1,
plan if the employer 2011, issuers should take these steps no
decreases its later than January 1, 2011. If these steps
contribution rate are taken, an insured group health plan
based on cost of that is a grandfathered health plan will
coverage towards the continue to be considered a
cost of coverage by grandfathered health plan.
more than 5 The relief in this Q&A2 will no longer
percentage points apply as of the earlier of the first date on
below the which the issuer knows that there has
contribution rate on been at least a 5-percentage-point
March 23, 2010.) reduction or the first date on which the
For purposes of plan no longer qualifies for
determining whether grandfathered status without regard to
an insured group the 5-percentage-point reduction.
health plan is a Moreover, nothing in the Affordable
grandfathered health Care Act or the interim final regulations
plan, what steps prevents a policy, certificate, or contract
should issuers and of insurance from requiring a plan
employer plan sponsor to notify an issuer in advance
sponsors take to (e.g., 30 or 60 days in advance) of a
communicate change in the contribution rate.
regarding changes to
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
Category Question Answer FAQ Title Agency Site
the plan sponsor’s
contribution rate?
Grandfathered Health Q3. Similarly, A3. If multiemployer plans and ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans multiemployer plans contributing employers follow steps Implementation act-Sheets-and-
do not always know similar to those outlined in Q&A2, FAQ #1
FAQs/aca_implementation_faqs.html
whether (or when) a above, the same relief will apply to the
contributing multiemployer plan unless or until the
employer changes its multiemployer plan knows that the
contribution rate as a contribution rate has changed.
percentage of the
cost of
coverage. What
steps should
multiemployer plans
take to communicate
with contributing
employers regarding
employer
contributions
towards coverage?
Grandfathered Health Q4. Also with A4. In this circumstance, if there is no ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans respect to increase in the employee contribution Implementation act-Sheets-and-
multiemployer plan towards coverage and any changes in FAQ #1
FAQs/aca_implementation_faqs.html
coverage, some the coverage terms would not otherwise
multiemployer plans cause the plan to cease to be
have stated that it is grandfathered, a change in a
common for such contributing employer’s contribution
plans to have either a rate will not, in and of itself, cause a
fixed-dollar plan that is otherwise a grandfathered
employee health plan to cease to be a
contribution or no grandfathered health plan.
employee
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
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contribution towards
the cost of
coverage. In such
cases, is it relevant if
a contributing
employer’s
contribution rate
changes (for
example, after
making up a funding
deficit in the prior
year or to reflect a
surplus), provided
any changes in the
coverage terms
would not otherwise
cause the plan to
cease to be
grandfathered and
there continues to be
no employee
contribution or no
increase in the fixed-
dollar employee
contribution towards
the cost of coverage?
Grandfathered Health Q5. Are the A5. The Departments invited comments ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans Departments on their interim final grandfather Implementation act-Sheets-and-
receiving other regulations, as well as on the appeals FAQ #1 FAQs/aca_implementation_faqs.html
comments and regulations and other provisions whose
questions regarding applicability is affected by status as a
the grandfather grandfathered health plan. The
regulations? Is more Departments have issued some sub-
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
Category Question Answer FAQ Title Agency Site
guidance expected? regulatory guidance on the appeals
regulations and will continue to review
and evaluate comments on these and
other regulations, and might issue
further sub-regulatory guidance on
selected issues as comments are
evaluated. Final regulations on the
various interim final regulations
recently issued under the Affordable
Care Act are expected to be published
beginning next year.
Grandfathered Health Q6. Will the A6. The Departments anticipate that ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans Departments change they will shortly address the Implementation act-Sheets-and-
the current rules so circumstances under which FAQ #1 FAQs/aca_implementation_faqs.html
that a grandfathered grandfathered group health plans may
group health plan change carriers without relinquishing
that changes carriers their status as grandfathered health plans
does not relinquish
its status as a
grandfathered health
plan?
Grandfathered Health Q7. My plan already A7. If your plan existed prior to ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans provided an external enactment of the Affordable Care Act, Implementation act-Sheets-and-
review process you should first check to see if your FAQ #1 FAQs/aca_implementation_faqs.html
before the Affordable plan is a grandfathered health plan. If it
Care Act was is, the new external review provisions of
enacted. Can my PHS Act section 2719(b) do not apply to
already-existing your plan.
external review If your plan is not a grandfathered
process be deemed to health plan and it is insured, the
comply with Public Departments have provided transitional
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
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Health Service Act relief under which plans can use
(PHS Act) section existing State external processes, in one
2719(b)? of the States in which they operate, to
comply with the new Federal
requirements. This transitional relief
applies regardless of whether the plan
already existed on March 23, 2010 or is
a new plan.
If your plan is not a grandfathered
health plan and it is self-insured, relief
is also provided. On August 23, 2010,
the Department of Labor issued
Technical
Release 2010-01, which sets forth an
enforcement safe harbor. If the plan
complies with one of the methods set
forth in the release, the Department of
Labor and the IRS will not take any
enforcement action with respect to PHS
Act section 2719(b) during the transition
period. See also Q&A8, below.
Grandfathered Health Q8. What if a self- A8. The technical release provides a ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans insured plan’s safe harbor from enforcement by the Implementation act-Sheets-and-
external review Departments. For plans that do not FAQ #1 FAQs/aca_implementation_faqs.html
process does not strictly comply with all the standards set
satisfy the safe forth in the technical release,
harbor in the DOL compliance will be determined on a
technical release? case-by-case basis under a facts and
circumstances analysis. Thus, a plan
that does not satisfy all of the standards
of the technical release’s safe harbor
may in some circumstances nonetheless
be considered to be in compliance with
PHS Act section 2719(b).
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
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For example, one of the standards set
forth in the technical release requires
self-insured plans to contract with at
least three independent review
organizations (IROs) and to rotate
claims assignments among them (or to
incorporate other independent, unbiased
methods for selection of IROs, such as
random selection). However, a self-
insured group health plan’s failure to
contract with at least three IROs does
not mean that the plan has automatically
violated PHS Act section
2719(b). Instead, a plan may
demonstrate other steps taken to ensure
that its external review process is
independent and without bias.
Grandfathered Health Q9. Similarly, what A9. The technical release does not ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans if a self-insured plan require a plan to contract directly with Implementation act-Sheets-and-
does not contract any IRO. Where a self-insured plan FAQ #1 FAQs/aca_implementation_faqs.html
directly with any contracts with a TPA that, in turn,
independent review contracts with an IRO, the standards of
organization (IRO), the technical release can be satisfied in
but contracts with a the same manner as if the plan had
third-party contracted directly. Of course, such a
administrator (TPA) contract does not automatically relieve
that, in turn, the plan from responsibility if there is a
contracts with an failure to provide an individual with
IRO? external review. Moreover, fiduciaries
of plans that are subject to ERISA have
a duty to monitor the service providers
to the plan.
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
Category Question Answer FAQ Title Agency Site
Grandfathered Health Q10. What if there is A10. The IRO is not required to be in ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans no IRO in my plan’s the same State as the plan. Plans may Implementation act-Sheets-and-
State? contract with an IRO even if it is located FAQ #1 FAQs/aca_implementation_faqs.html
in another State.
Grandfathered Health Q11. The A11. Only the times for making the ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans Departments’ initial benefit determination were Implementation act-Sheets-and-
regulations make changed. The Departments have revised FAQ #1 FAQs/aca_implementation_faqs.html
changes to shorten the model notice to eliminate
the times for making confusion. The revised notice includes
initial determinations a header that reads, “Revised as of
with respect to September 20, 2010”.
urgent care claims,
but did not make any
changes to the times
for making internal
appeals
decisions. The
Departments’ model
notice of adverse
benefit determination
issued on August 23,
2010, was unclear as
to which times have
been
shortened. What is
the rule?
Grandfathered Health Q12. I anticipate A12. Yes, on September 20, 2010 the ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans that my plan will no Department of Labor issued Technical Implementation act-Sheets-and-
longer be a Release 2010-02 at FAQ #1 FAQs/aca_implementation_faqs.html
grandfathered plan http://www.dol.gov/ebsa/newsroom/tr10
and will have a hard -02.html providing an enforcement
time making systems grace period until July 1, 2011 to give
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
Category Question Answer FAQ Title Agency Site
changes in time to plans and issuers necessary time to
comply with some of make certain procedural and computer
the new standards for system changes to comply with the new
claims and internal requirements
appeals. Is there any
relief?
Grandfathered Health Q13. The September A13. No. The Technical Release 2010- ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Plans 20, 2010 technical 02 provides that the standards of the Implementation act-Sheets-and-
release, among other Department of Labor’s claims procedure FAQ #1 FAQs/aca_implementation_faqs.html
things, gives plans regulation issued on November 21, 2000
and issuers additional (29 CFR 2560.503-1) apply. A grace
time (as an period is given only for the new content
enforcement grace required under paragraph (b)(2)(ii)(E) of
period until July 1, the Departments’ July 23, 2010 interim
2011) before they final claims and appeals regulations. In
have to provide new addition, under existing regulations,
content (such as claimants may obtain coding and other
coding information) information relevant to the claimant’s
on notices of adverse claim for benefits free of charge upon
benefit determination request. See 29 CFR 2560.503-
and notices of final 1(h)(2)(iii).
adverse benefit
determination. Does
this mean that
notices are not
required during the
grace period?
Dependent Coverage and Q14. Will a group A14. No. A plan or issuer does not ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Children health plan or issuer fail to satisfy the requirements of PHS Implementation act-Sheets-and-
fail to satisfy section Act section 2714 or its implementing FAQ #1 FAQs/aca_implementation_faqs.html
2714 of the Public regulations because the plan limits
Health Service Act health coverage for children until the
ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013
(HHS/CCIIO; Labor; Treasury/IRS)
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(PHS Act) and its child turns 26 to only those children
implementing who are described in section 152(f)(1)
interim final of the Code. For an individual not
regulations merely described in Code section 152(f)(1),
because it conditions such as a grandchild or niece, a plan
health coverage on may impose additional conditions on
support, residency, or eligibility for health coverage, such as a
other dependency condition that the individual be a
factors for dependent for income tax purposes.
individuals under age
26 who are not
described in section
152(f)(1) of the
Internal Revenue
Code (Code)? (That
section of the Code
defines children to
include only sons,
daughters,
stepchildren, adopted
children (including
children place for
adoption), and foster
children.)
Out-of- Network Q15. Public Health A15. No. As stated in the preamble to ACA CCIIO http://www.cms.gov/CCIIO/Resources/F
Emergency Services Service Act (PHS the interim final regulations under Implementation act-Sheets-and-
Act) section 2719A section 2719A, the minimum payment FAQ #1 FAQs/aca_implementation_faqs.html
generally provides, standards set forth in paragraph (b)(3) of
among other things, the regulations were developed to
that if a group health protect patients from being financially
plan or health penalized for obtaining emergency
insurance coverage services on an out-of-network basis. If
provides any benefits a State law prohibits balance billing,
for emergency plans and issuers are not required to
Description:ALL ACA-RELATED FEDERAL FAQs AS OF October 9, 2013. (HHS/CCIIO; Labor
; Treasury/IRS). Category. Question. Answer. FAQ Title. Agency Site.
