An interesting point for some plans and their compliance is that the plan may need to follow certain limits on the health plan coverage under the plan. This is sometimes referred to as the out-of-pocket maximum. The federal government generally defines an out-of-pocket maximum in their uniform glossary that accompanies the Summary of Benefits and Coverage (SBC) as the following:
The most you pay during a policy period before your health insurance or plan begins to pay 100% of the allowed amount. This limit never includes your premium, balance-billed charges or health care your health insurance or plan doesn’t cover.
A confusing point on this however is that there will be two different limits to consider for some plan compliance starting in 2015. One rule deals with Health Savings Accounts (HSA) and one rule deals with the Affordable Care Act (ACA).
- HSA LIMIT: First, HSAs have has a maximum out-of-pocket for the corresponding High Deductible Health Plan (HDHP). This is one of the required elements of meeting eligibility to contribute to an HSA, namely that the HDHP plan enrollment meets certain threshold amounts including a maximum out-of-pocket. This only applies to HDHP requirements related to HSA eligibility. It also covers all in-network benefits under the plan.
- ACA LIMIT: Second, the ACA currently has a maximum out-of-pocket for plan qualification status under federal law. This section cited the HSA rules in the Code, but used a different methodology to adjust those numbers in the future. In addition, this limit only applies to the Essential Health Benefits under the plan which may not include all in-network coverage. Last but not least, this rule is subject to Grandfather status, meaning that if the plan is Grandfathered in accordance with the ACA, it is exempt from the maximum out-of-pocket amounts.
Technically speaking, it appears an HSA plan must follow both, while a non-HSA plan will only follow the ACA limit. Both sets of rules also define the limit in terms of single coverage (meaning coverage for one person) or family coverage (meaning any coverage above one person). Please see the following chart attempting to highlight some of these differences including the limits for 2014 and 2015.
If you have questions on the ACA or HSAs, please contact Kinney & Larson.