grandfathered and grandmothered health plans

Grandfathered Health Plans

Grandfathered plans are small group health insurance plans that were already in existence at an organization on March 23, 2010 when the Affordable Care Act (ACA) was signed into law. These plans can continue offering coverage as they did prior to the ACA with very specific stipulations. These plans are exempt from some of the ACA requirements, such as preventive health services coverage without any cost-sharing and the expanded appeals process and external review. However, they are subject to other provisions and non-compliance can result in a loss of the grandfathered status.

Grandmothered Health Plans

Grandmothered health plans, on the other hand, are small group health insurance plans that have been in place since before January 1, 2014. Grandmothered plans are subject to a Health and Human Services transition policy, allowing insurers in these markets to renew health insurance policies they would otherwise have cancelled due to noncompliance with certain ACA insurance market reforms such as premium rate rules, guaranteed availability and renewability, the requirement to provide essential health benefits, and so on.

Grandmothered plans do not have to comply with the bulk of the ACA’s provisions, they are not required to cover essential health benefits other than preventive care, and they cannot have annual or lifetime benefit limits for covered essential health benefits. Small group grandmothered plans cannot impose pre-existing condition exclusions or benefit waiting periods that exceed 90 days. Transition relief for grandmothered plans has been extended several times over the years.