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White House and CMS Announce Administrative Delay in ACA Insurance Mandates

Yielding to growing political pressure, the White House (here and here) and CMS (here) announced yesterday an administrative delay in enforcement of insurance market reforms under the Affordable Care Act, thereby allowing insurance carriers to retain non-conforming policies for one more year. This addresses concerns over the "keep what you've got" issue.

Insurers had been in the process of announcing the termination or cancelation of policies that did not meet all the requirements that are scheduled to apply to insurance policies beginning January 1, 2014. This includes the requirements to cover all "essential health benefits" and provide first-dollar preventive care coverage. Policy holders facing cancelation had expressed frustration after believing enactment of the ACA would not deprive them of their coverage.

The delay does not affect all policies - just those issued in the individual and small group markets. (Many policies issued in connection with employer sponsored plans are large group policies and will not be affected. Similarly, self-insured health plans are not affected.) Also, the delay is not automatic. The administrative guidance authorizes state insurance commissioners to allow carriers to maintain non-conforming policies, but it is up to each state to decide whether it will provide that flexibility. And even in states that grant carriers the right to maintain their policies, it is up to the carriers to decide whether a policy will be retained. So the guidance is far from a universal solution. 

In many cases, states and insurance carriers have already taken significant steps toward complying with the new ACA mandates, so they may not be inclined to change course with little over a month to go until the beginning of the new year.

At this time, neither the Kansas insurance commissioner nor the major insurance carriers in Kansas have indicated how they will respond to the additional flexibility. 


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Don Berner, the Labor Law, OSHA, & Immigration Law Guy
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Boyd Byers, the General Employment Law Guy
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Jason Lacey, the Employee Benefits Guy
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