X


Let's Talk

Let us help you make
an informed decision
Required:

How can we help you?

Looking for client support?
Click here instead.

 

Updated 6/8/2015

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.

More Information

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.

 

 

The information and materials on this blog are provided for informational purposes only and are not intended to constitute legal or tax advice. Information provided in this blog may not reflect the most current legal developments and may vary by jurisdiction. The content on this blog is for general informational purposes only and does not apply to any particular facts or circumstances. The use of this blog does not in any way establish an attorney-client relationship, nor should any such relationship be implied, and the contents do not constitute legal or tax advice. If you require legal or tax advice, please consult with a licensed attorney or tax professional in your jurisdiction. The contributing authors expressly disclaim all liability to any persons or entities with respect to any action or inaction based on the contents of this blog.

Bonnie Mangels – Bonnie is the Corporate Counsel and Senior Compliance Manager for Sequoia. When not inundated in paperwork and legal briefs, her interests include arts and crafts, bunnies, and the Bay Area.