The Department of Health and Human Services released FAQs confirming that the clarification on individual cost sharing limits applies to all non-grandfathered group health plans, including self-insured and large group health plans. Therefore, beginning with 2016 plans years, all non-grandfathered plans that provide for other than self-only coverage (e.g., family coverage) will be required to embed a self-only out-of-pocket limit of $6,850 within the plan.
The FAQs also confirm that the embedded out-of-pocket limit rules apply to all non-grandfathered high-deductible health plans (HDHPs).
What do I need to know? Effective 1/1/2016, annual cost sharing limits on self-only coverage apply to all individuals, regardless of the type of plan.
The Department of Health and Human Services released the HHS Notice of Benefit and Payment Parameters for 2016, which provided clarification on individual cost sharing limits. The annual cost-sharing limit on self-only coverage is $6,600 in 2015 and $6,850 in 2016. The Notice made clear that an individual’s cost sharing for essential health benefits may never exceed the self-only annual limitation, regardless of whether the individual is covered by a self-only plan or another plan, such as a family plan. Therefore, if an employee and his/her family are on a family plan and they incur $8,000 in the plan year on cost sharing expenses, $7,000 of which were incurred by the employee’s spouse, the spouse would only pay a maximum of $6,600 and the remaining $400 would be paid by the health plan.
This clarification will be effective for plan years beginning on or after 1/1/2016.
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