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August 16, 2010

Mr. Jim Mayhew

Office of Consumer Information and Oversight

Department of Health and Human Services

Attention: OCIIO-9991-IFC

P.O. Box 8016

Baltimore Maryland 21244-1850

Re: CCD Comments regarding the Interim Final Rule and Proposed Rule for Group 

Health Plans and Health Insurance Coverage Relating to Status as a Grandfathered Health 

Plan under the Patient Protection and Affordable Care Act

Dear Mr. Mayhew:

The Consortium for Citizens with Disabilities (CCD) appreciates the opportunity to comment on 

the interim final rule and proposed rule relating to status as a grandfathered health plan under the 

Patient Protection and Affordable Care Act (Pub. L. 111-148). CCD believes comprehensive 

health care reform should ensure that all Americans, including individuals with disabilities and 

chronic conditions, have access to high quality, comprehensive, affordable health care that meets 

their individual needs and enables them to be healthy, functional, live as independently as 

possible, and participate in the community.

We applaud the Department of Health and Human Services (HHS) for requiring grandfathered 

plans to adhere to a number of important consumer protections in order to retain status as a 

grandfathered plan. Specifically, CCD commends the HHS Secretary for requiring grandfathered 

plans to disclose their status to their enrollees and specifically state which benefits they do 

provide and for requiring grandfathered plans to lift lifetime limits on essential health benefits.

The purpose of grandfathering plans is to provide a transition period that allows individuals 

satisfied with their current insurance plan to keep it intact during a period of rapid change in the 

insurance market, perhaps leading to an avoidance of disruption in their coverage. The regulation 

needs to ensure a smooth transition so as not to disrupt current coverage and consumer 

protections without inadvertently establishing a permanent “underclass” of grandfathered plans 

to which PPACA does not apply. Establishing grandfathering rules that are too permissive risks 
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the creation of a separate insurance market where patients and consumers do not gain the 

benefits of health care reform and would ultimately work to the detriment of persons with 

disabilities and chronic conditions who need PPACA‟s protections to ensure access to quality 

care. 

On the other hand, CCD acknowledges some risk in making grandfathering rules too strict, 

especially if the essential benefits package is not as expansive as the disability community 

expects it to be. Individuals and enrollees in group plans with relatively generous benefit 

packages that cover disability and rehabilitation services may stand to lose access to important 

benefits if their plan loses grandfathering protection and the new essential benefits package is not 

as comprehensive in terms of benefits coverage. But above all, this underscores the importance 

of defining the essential benefits package in a way that meets the needs of people with 

disabilities and chronic conditions.

In order to protect participants with disabilities that are covered under a grandfathered 

plan, on balance, CCD believes that HHS should broaden the circumstances under which 

grandfathered plans must become subject to the consumer protections that apply to all 

other new plans. In addition to the provisions in the regulation that trigger a loss of 

grandfathered status such as changes in cost sharing and employer contributions, which CCD 

supports, CCD lists below additional circumstances under which grandfathered plans should lose 

their status:

 Any significant decrease in benefits should result in the loss of grandfathered status. The 

current version of the rule only retracts status when grandfathered plans eliminate all or

substantially all benefits linked to a specific condition. While this language serves as an 

important protection against singling out specific types of conditions or disabilities, we 

believe additional guidance should be promulgated that all significant decreases in the 

scope or breadth of the benefit package will trigger this loss of grandfathered status. For 

instance, if a plan were to decide to cap the number of therapy visits for rehabilitative 

care, cap coverage for durable medical equipment, or limit coverage of prosthetic limbs 

over a lifetime, these restrictions in benefits should trigger a loss of grandfathered status. 

For example, a cap of $500 on durable medical equipment essentially eliminates the 

ability of a person requiring a wheelchair to access an appropriate mobility device. 

Similarly, a limit of “one prosthetic limb per lifetime” is totally unrealistic and, for 

instance, provides only temporary relief for a growing child. If these types of benefit 

limits are imposed by plans with grandfathered status, such status should be rescinded.

 Any substantial change to the structure of a grandfathered plan should result in the 

elimination of the plan‟s grandfathered status. These structural changes could 

fundamentally change the existing coverage in a manner that significantly affects 

enrollees, particularly individuals with disabilities and chronic conditions whose 

coverage may be severely limited by a change in plan structure. For example, if a 

grandfathered preferred provider organization (PPO) becomes a closed-panel health 

maintenance organization (HMO), these plans should lose their grandfathered status.
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 Significant changes to the prescription drug formulary should result in loss of

grandfathered status. Although the use of prescription drug formularies may provide 

valuable cost containment and quality assurances to health plan enrollees, changes in the 

design and administration of prescription drug benefits can have a major and negative 

impact on some of a plan‟s most vulnerable enrollees. To encourage plans to maintain 

grandfathered status through the continued provision of “all or substantially all benefits 

to diagnose or treat a particular condition”, grandfathered status should cease upon any 

of the following changes to the administration of prescription drug benefits and 

formularies. 

1. Restricting the formulary overall by shifting from an open formulary to a closed or 

tiered formulary; 

2. The establishment of new, higher, or specialty tiers with the effect of increasing 

enrollees‟ cost-sharing requirements; 

3. The elimination of one or more tiers with the effect of increasing certain enrollees‟ 

cost-sharing requirement; 

4. The re-arrangement of tiers among a covered class of drugs resulting in a reduction 

in the total number of drugs with the lowest cost-sharing requirement; 

5. Restricting a formulary to „generics only‟; 

6. Requiring mail-order delivery for some or all drugs on the formulary. 

7. Eliminating specialty pharmacy support services for certain plan members with 

special needs; 

8. Imposing, or lengthening the moratorium period before new therapies can be added 

to the formulary; and/or

9. The elimination of a drug(s) from the formulary for reasons other than patient safety. 

 

 Plans that place significant additional limits on a provider network should also lose 

grandfathered status. Under the existing regulations, an enrollee could see their provider 

network drop to 5 doctors while the plan maintains its grandfathered status. Even losing 

one or two physicians could have a serious impact to individuals with disabilities and 

chronic conditions who often rely on specialized care.

Additionally, we believe that it is crucial that individuals covered under a grandfathered plan 

know exactly what consumer protections they are afforded. As such, grandfathered plans should 

not only be required to list what benefits they do provide but also which consumer protections 

they lack.
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Finally, the interim final and proposed rules do not establish an effective mechanism for 

oversight and enforcement of these important rules. Without such a process in place, there is no 

way to ensure adherence and plans may avoid complying with the rules yet maintain that they are 

a grandfathered plan. Without an effective process for challenging grandfathered status, 

consumers will be without a remedy in the face of significant changes to their grandfathered plan 

that may keep them indefinitely from the protections afforded under the Affordable Care Act. 

CCD recognizes the value of grandfathered status of some plans as a means to smoothly 

transition into a completely reformed private insurance market. But grandfathered status should 

be viewed as a temporary option to those plans that make a good faith effort to retain current 

coverage, not a permanent exemption from the new rules of the insurance market. 

If you have any questions, please feel free to contact any of the Health Task Force Co-Chairs 

listed below.

Sincerely,

American Association of People with Disabilities

American Counseling Association

American Medical Rehabilitation Providers Association

American Music Therapy Association

American Network of Community Options and Resources

American Occupational Therapy Association

American Physical Therapy Association

American Speech language Hearing Association

Association of University Centers on Disabilities

Autism National Committee

Autism Society

Bazelon Center for Mental Health Law

Brain Injury Association of America

Children and Adults with Attention-Deficit/Hyperactivity Disorder

Community Access National Network

Easter Seals

Epilepsy Foundation

National Alliance on Mental Illness

National Association of County Behavioral Health and Developmental Disability Directors

National Association of State Head Injury Administrators

National Council for Community Behavioral Healthcare

National Disability Rights Network 

National Down Syndrome Congress

National Multiple Sclerosis Society

National Spinal Cord Injury Association

Paralyzed Veterans of America

TASH

The Arc of the United States

United Cerebral Palsy

United Spinal Association