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8-11-10 

-Office ofConsumer Information and Insurance Oversight 


Depaltment ofHealth and Human Services 


Attention: OCnO-999 


P.O. Box 8016 


Baltimore, MD 2 J244-1850 


Re: Interim Final 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 

Below are our COf1:nnents regarding the Interim Final Rule for Group Health Plans and Health 

Insurance Coverage Relating to Status as a Grandfathered Health Plan Under the Patient 

-Pl:utection and Affordable £;are Acct cepA~l1} ~ 

We believe that every effort should be rnade to increase the number ofindividuals covered by 

PPACA, especiaIJy as ofJanuary 1,2014 when most ofthe reform components (Insurance 

Exchanges, Subsidies, Tax Credits, etc.) come into play. 

The Rule provides the seven triggers that would revoke the grandfathered status ofa group 

health plan: 

.. :Mergers or acquisitions with the sole intention ofmaintaining grandfather status 

e Elimination ofsubstantially all benefits to treat a patticular condition 

• Elimination of benefits for any element necessalY to eliminate or diagnose a condition 

e Any change to coinsurance level 

e Fixed-amount cost-shating (Deductibles/OOP) Inflation +I5% 

• Co-payments (Medicallnfiation +15% or $5 adjusted for medical inflation) 

.. Employer contribution (> 5% reduction in Employer Contribution) 

While relatively straightforward, these guidelines may still result in some confilsion to the 

'.... _ _ __ _ 	 marketplace in their: application. FocexatrlpJe, jf.:anemployerraised the .copaY1llent level beyond~ 

the maximum in Olle area (i.e. outpatient selvices) but retained the copayment level for primary 

care doctor visits, does that mean a loss of grandfather status? Clarity will be critical both for the 

employer and the employee. 

The average consumer has a broad definition of"benefits. " Consumers view their health plan 

beyond the covered benefits, cost sharing, and the contribution levels associated with the plan. 

Other components ofhealth care services can have a significant impact on the individual 

employee, which can result in a change to their plan including: 

e A .'substantial change n to the provider network 

Consumers believe their provider and the provider network associated with any plan is an 

integral Palt ofthe health care benefits provided by the employer. A termination of a 
hospital system or specific provider group sometimes has significant impact on the 

employee population and should be viewed as a substantial change to the plan itself As a 

guideline, we would suggest any change in the provider network impacting over 50010 of 

the employee population (nationally or locally) should result in a loss ofthe grandfather 

status. 

@; 	 Change in issuer or third-party administrator (TPA) (tncluding movingfromflllly­

insured to self....funded) 


Even ifthe benefit stmcture of a group health plan remains largely the same, a change in 

administration ofthe plan requires new communication, new processes, and new 

requirements on the part ofan employee and the elupJoyer. Moving fi'om a fully-insured 

to a self-ftmded status or changing administrators requires new processes and legal 

- -agreements fef thegmup health platl:~T'!lese transitions;are~notdaily~oLregulacevents and. 

should be considered a change in the group health plan. 

• 	 Signtficant change in care management!t11lthorfzation requirements 

The processes consumers need to follow to receive care are a significant component of 

their perceptions oftheir health benefits platt Changing notification requirements, 

requiring referrals, or other care management strategies involved in the delivery of care 

should also be considered as a change to the plan. This may prevent group health plans 

from maintaining their grandfather status by not necessarily eliminating a benefit, but 

making it difficult to receive by changing the care management process around it. 

Even by the most optimistic estimates, a substantial portion ofthe employee population will 

remain outside the PPACA as ofJanuary 2014 based on the current rules. While we understand 

the difficulty involved in making change, creating another large sub-population of excluded 

individuals will only add to costs, increase confiIsion, and mitigate the potential impact ofthe 

legislation. This only adds to the uncertainty surrounding the $143 billion in deficit reduction 

projected by the Congressional Budget Office (CBO) wilen the process began. 

We believe that any changes related to the areas listed above shouldllisoresult}n a Jos~ of . _ ~ ~_ 

grandfatherostarus'as~fhese'ar~n~hanges~fharheaVllyrhipactapatienfshearthcare-benefits. The ... 

Rule needs to be clear, reasonable, and with no ambiguities involved in determining whether a 

group health plan is "in or out." The decisions we make today will determine the outcomes for 

tomotTOW. We may need to make some difficult decisions to create a sustainable health care 

system that will support a growing economy in the future. That means getting as many citizens 

across the country participating at the beginning to make it work and delivering on its promises 

to retain their support. 

Thank you for the opportunity to comment on this regulation.