ACA UPDATE: Deadline Extended for Small Employer Non-ACA Plans

On March 25, 2019 the Centers for Medicare and Medicaid Services (CMS) issued a bulletin regarding another extension for small employers to continue to offer non-ACA compliant plans in the small group market.

Starting in 2013, CMS has been allowing states to continue to allow certain coverage in the individual and small group markets that did not comply with the ACA requirements. The most recent extension allows for the renewal of these policies for policy years beginning on or before October 1, 2019 provided that all policies would end by December 31, 2019.

This current CMS bulletin extends the transitional policy to policy years beginning on or before October 1, 2020, provided that all such policies end by December 31, 2020. States are allowed to permit insurers that have renewed these policies continually since 2014 to renew the coverage for any policy year before October 1, 2020 with the understanding that any coverage renewed under this transitional policy must be in compliant with ACA small group requirements by January 1, 2021. To accommodate, states may also allow policy years that are shorter than 12 months or early renewals with a January 1, 2020 start date.

On Wednesday, April 3, 2019, the State of Wisconsin, Office of the Commissioner of Insurance (OCI) issued a bulletin to all insurers authorized to write health insurance in Wisconsin confirming state support for the extension. In addition, OCI will allow insurers to extend an annual policy through December 31, 2020 for policies that end prior to that date (non-calendar plan years) so that consumers are not left with a gap in coverage from the date of policy renewal to the end of the year.

Key takeaway:

This extension will only effect non-grandfathered health insurance plans offered by employers who are legally defined as small employers (Less than 50 full-time employees). Since this is a state-based standard, you should check with the office of your State Insurance Commissioner to understand if this is an option for your group health insurance plan.

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