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The Wagner Law Group

The Wagner Law Group, A Professional Corporation, is a nationally recognized ERISA & employee benefits, estate planning, employment, labor & human resources practice. 

 

Established in 1996, The Wagner Law Group has 22 attorneys engaged exclusively in employee benefits, estate planning and employment law. Six of our attorneys are AV rated by Martindale-Hubbell as having very high to preeminent legal abilities and ethical standards. The firm is among the largest ERISA boutiques in the country. Our practice is national in scope, with clients in more than 40 states and several foreign countries.

 

 

 

 

Contact Info

The Wagner Law Group

 

  Integrity | Excellence

  

Boston 

Tel: (617) 357-5200 

Fax: (617) 357-5250 

99 Summer Street 

13th Floor

Boston, MA 02110


Palm Beach Gardens 

Tel: (561) 293-3590
Fax: (561) 293-3591
7108 Fairway Drive
Suite 125
Palm Beach Gardens, FL 33418

   

Tampa

Tel: (813) 603-2959

Fax: (813) 603-2961

101 East Kennedy Boulevard

Suite 2140
Tampa, FL  33602 

 

San Francisco

Tel: (415) 625-0002

Fax: (415) 358-8300

315 Montgomery Street

Suite 904

San Francisco, CA 94104

 

St. Louis

Tel: (314) 236-0065

Fax: (314) 236-5743
100 South 4th Street, Suite 550
St. Louis, MO  63102 

 

www.wagnerlawgroup.com

 

 

 

 

August 13, 2015

 

 Health and Welfare Law Alert

 

 

 

ACA FAQs Address Cost-Sharing Limits

 

 

 

DOL, HHS and IRS (the "Departments") have released FAQs About Affordable Care Act Implementation Part XXVII ("FAQ XXVII"). FAQ XXVII provides clarification of the application of cost-sharing limits under the Affordable Care Act ("ACA") to certain group health plans.

  

Background. The ACA requires all non-grandfathered group health plans to have an annual cost sharing limit for covered, in-network essential health benefits that, for the 2015 plan or policy year, does not exceed $6,600 for self-only coverage and $13,200 for family coverage. For plan or policy years beginning in 2016, these amounts increase to $6,850 and $13,700, respectively.

  

HHS released final regulations setting forth the 2016 annual cost-sharing limitations for qualified health plans. In the preamble to the final regulations, HHS said the self-only annual limitation should be applied to each covered individual, regardless of whether that individual has self-only, family, or other coverage.

  

FAQ XXVI. FAQ XXVII affirms HHS's position that the ACA's cost-sharing limitations apply to each covered individual, regardless of the tier of coverage the individual has and no matter how the plan is funded. In particular, FAQ XXVII provides that the application of the cost-sharing limit applies to all non-grandfathered group health plans, including both self-insured and large group plans. This interpretation, in effect, embeds the individual out-of-pocket maximum in these group health plans. By way of example, FAQ XXVII explains that an insurer can offer a plan with a $10,000 family deductible as long as each covered individual's annual cost-sharing limit is capped at $6,850 (in 2016), regardless of whether the $10,000 family deductible has been met.

 

Action Steps for Employers. Employers should review their 2016 welfare plan design to ensure compliance with the ACA cost-sharing rules outlined in FAQ XXVII. Plan documents and employee communications describing the applicable out-of-pocket maximum must be updated to reflect the new requirements.

 

However, employers should note that the ACA allows higher 2016 out-of-pocket maximums than those permitted for HDHP coverage. The 2016 IRS out-of-pocket maximum for self-only HDHP coverage is $6,550, and for other than self-only coverage it is $13,100. Accordingly, employers offering HDHP plans must satisfy these lower HDHP out-of pocket maximums.

 

FAQ XXVII may be accessed at: http://www.dol.gov/ebsa/pdf/faq-aca27.pdf

  

 

 

 

This Newsletter is protected by copyright. Material appearing herein may be reproduced with appropriate credit.

 

This Newsletter is provided for information purposes by The Wagner Law Group to clients and others who may be interested in the subject matter, and may not be relied upon as specific legal advice.  This material is not to be construed as legal advice or legal opinions on specific facts. Under the Rules of the Supreme Judicial Court of Massachusetts, this material may be considered advertising.