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Health Care Reform FAQs
The Affordable Care Act (ACA) was signed into law on March 23, 2010. Some of the law's provisions were effective in 2010, while others will be phased in through 2014 and beyond. The information provided here is based on our current understanding of the ACA. Lawmakers and regulators continue to update and clarify regulations regarding these provisions, so this information is subject to change.
Grandfathered vs. Non-Grandfathered Status
What is a grandfathered plan?
What is a non-grandfathered plan?
How will I know whether my plan is grandfathered or non-grandfathered?
Do the ACA regulations apply to both grandfathered and non-grandfathered plans?
Dependent Coverage for Children up to Age 26
When does this become effective?
What if I have a dependent who previously became ineligible for coverage?
Tax Credits for Small Employers
Am I eligible for tax credits?
What is a grandfathered plan?
A grandfathered plan is an employer-sponsored health plan that existed on March 23, 2010, and has not undergone any significant plan changes. They are "grandfathered" and thereby exempt from some of the requirements of the Affordable Care Act (ACA). A plan change in the employer's contribution or benefit design could result in a loss of grandfathered status. This is a one-year designation.
What is a non-grandfathered plan?
A non-grandfathered plan is an employer-sponsored or individual health plan that did not exist on March 23, 2010, or was changed on/after March 23, 2010. Non-grandfathered plans must adhere to all ACA provisions at first contract renewal on/after September 23, 2010.
How will I know whether my plan is grandfathered or non-grandfathered?
Beginning October 1, 2010:
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New and renewing small employer groups will be enrolled in non-grandfathered plans.
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New large groups will be enrolled in non-grandfathered plans
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Existing large groups will have the option of choosing a grandfathered plan. If you have any questions about grandfathered status, please contact your local sales office.
Beginning January 1, 2011:
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Renewing individual and family policyholders will be enrolled in grandfathered plans only.
Do the ACA regulations apply to both grandfathered and non-grandfathered plans?
No, grandfathered plans are exempt from some of the regulations. Please see the list of regulations and effective dates.
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When does this become effective?
On June 1, 2010, Valley Baptist Health Plans voluntarily began allowing currently enrolled dependents to remain on their parents' fully insured plans until age 26. This policy change did not include reinstatement of dependents who previously aged out of their plan. Nor did it include any self-funded group.
Beginning September 23, 2010:
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Renewing groups enrolling in a grandfathered plan must allow coverage for dependents up to age 26 regardless of marital or student status - as long as they are not eligible for other coverage.
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New and renewing groups enrolling in a non-grandfathered plan must allow coverage for dependents up to age 26 - even if they are covered, or eligible to be covered, by another plan.
What if I have a dependent who previously became ineligible for dependent coverage due to age, marital status, or student status?
That dependent may be added back on to your plan at your group's next renewal date and remain covered until age 26.
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Am I eligible for tax credits?
If you have fewer than 25 employees and provide health insurance, you may qualify for a small business tax credit this year of up to 35 percent (up to 25 percent for non-profits) to offset the cost of your insurance. To find out if you are eligilbe, visit www.irs.gov or contact your tax professional.
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To learn more, please visit one of the websites below.
IRS.gov
Provides information about the new small business health care tax credit, including instructions for claiming the credit on your 2010 tax return.
HealthCare.gov
Provides up-to-date information on the health care reform law and its implementation.
Centers for Medicare and Medicaid Services Health Reform Center
Includes links to reports, guidance, and regulations from Centers for Medicare and Medicaid Services, the agency that oversees the Medicare and Medicaid programs.
Texas Department of Insurance
Offers health care reform information specific to Texas group health plans. test link
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