Jul 09, 2010

Update on Health Care Reform: DOL Releases Model Notices on Adult Child Coverage, Lifetime Limits, and Patient Protections

Last week, the Department of Labor (“DOL”) released model notices that may be used to satisfy the notice obligations for the following requirements under the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (together, the “Health Care Reform Legislation”): (1) the requirement to cover adult children up to age 26, (2) the prohibition on lifetime limits, and (3) the requirement to provide certain “patient protections.” These three requirements are effective for plan years beginning on or after September 23, 2010 -* January 1, 2011* for calendar year plans.

Model Notice for Adult Child Coverage up to Age 26

As explained in a previous Client Alert, group health plans and health insurance issuers offering dependent coverage must make such coverage available for adult children up to age 26. Adult children who become eligible to enroll in a group health plan because of this new coverage requirement must be provided written notice of their enrollment rights by the first day of the first plan year beginning on or after September 23, 2010 – January 1, 2011 for calendar year plans. This notice may be provided with a plan’s enrollment materials, provided that the notice is “prominent.”

Group health plan sponsors should consider providing this notice in advance of the notice deadline in order to avoid the difficulties in administering retroactive enrollment for adult children under age 26.

 

Model Notice for the Prohibition on Lifetime Limits

As explained in a previous Client Alert, group health plans and health insurance issuers are prohibited from imposing a lifetime limit on the dollar value of “essential health benefits.” Individuals who had reached a lifetime limit under a group health plan, and who are otherwise still eligible for coverage under the plan, must be provided with written notice that the lifetime limit no longer applies. Individuals who are no longer enrolled in the plan must be provided notice of their enrollment rights by the first day of the first plan year beginning on or after September 23, 2010 -* January 1, 2011* for calendar year plans. Similar to the adult child coverage notice, this notice may be provided to an individual with a plan’s enrollment materials, provided that the notice is “prominent” and the individual is still receiving plan communications.

 

Model Notice for Patient Protections

As explained in a previous Client Alert, group health plans and health insurance issuers with a network of providers must (1) permit a participant to choose a primary care provider including a pediatrician when the plan or issuer requires designation of a primary care provider, and (2) permit a participant to obtain obstetrical or gynecological care without prior authorization. Notice of these rights must be provided to plan participants when participants are provided with a summary plan description (or other similar description of benefits under the plan) by the first day of the first plan year on or after September 23, 2010 – January 1, 2011 for calendar year plans. Notably, these particular notice requirements are not applicable to grandfathered health plans.

 

For more information on the DOL’s model notices or the requirements imposed by the Health Care Reform Legislation, please contact your SGR Executive Compensation and Employee Benefits counsel.


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