The state of grandmothered and grandfathered plans
- Hundreds of thousands still have grandmothered or grandfathered health plans.
- Grandfathered plans can remain in force indefinitely.
- States and health carriers decide whether you can keep a grandmothered plan.
- An extension allowed grandmothered plans in some states to renew as late as Oct. 1, 2018.
- Grandmothered plans must comply with more ACA regulations than grandfathered plans.
- Thirty-one states still allow renewals of grandmothered plans.
- Four states would allow renewals but no longer have any grandmothered plans in the individual market.
- Fifteen states are not allowing renewals of grandmothered plans.
Open enrollment for 2018 health coverage starts on November 1, 2017 – which will be here before you know it. But if you’re still covered under a plan you had prior to 2014, you haven’t had to do anything during the first four open enrollment periods. And you might be able to keep your plan again for 2018.
But that doesn’t necessarily mean that doing so will be the best option. It’s important to check out the other plans that will be available during open enrollment, and compare the premiums and coverage with the plan you’ve got now – keeping in mind that your current plan’s premium will likely increase again for 2018.
Grandfathered, grandmothered plans still in force
There are still hundreds of thousands of people who have coverage under a grandfathered or grandmothered individual health plan. Grandfathered plans, which were already in force as of March 23, 2010, can continue to remain in force indefinitely, at the discretion of the health insurance carrier (carriers can, and do, terminate grandfathered plans), as long as they don’t make any substantial changes to the coverage.
Grandmothered plans are different. When the ACA was written, there was no provision for grandmothered plans. These are the plans that were purchased after the ACA was signed into law, but before October 1, 2013 when the exchanges opened for business. The original timeline was that they would all terminate either at the end of 2013, or at their renewal date in 2014. They would then be replaced by ACA-compliant coverage, and the only non-compliant plans remaining would be grandfathered plans.
But amid the uproar over cancelled plans in the fall of 2013, the Obama Administration announced a transitional relief program to allow non-grandfathered policies to renew at the end of 2013 (regardless of when their original renewal date would have been) and remain in force until their new renewal date in late 2014.
The final decision was left up to the states and to the health insurance carriers. Some states and carriers rejected the idea of creating a grandmothered plan provision, and required non-grandfathered health plans to terminate as planned. But many states and carriers accepted the new guidelines.
Some plans can stay in force until December 2018
In March 2014, HHS extended the transitional relief, permitting renewals as late as October 1, 2016, with the plans allowed to remain in force until as late as September 30, 2017.
Then, another extension was issued in February 2016, allowing grandmothered plans to continue to renew up until October 1, 2017, but with a termination date no later than December 31, 2017.
Yet another extension was issued in February 2017, allowing – at each state’s discretion – grandmothered plans to renew until as late as October 1, 2018, as long as they terminate no later than December 31, 2018. (This replicated the extension that was issued in 2016, but with the deadlines pushed out by one year.)
What grandmothered plans must cover
Grandmothered plans must comply with more ACA regulations than grandfathered plans. These include covering preventive care with no cost-sharing, and eliminating annual benefit limits for any essential health benefits (EHBs) that the plan covers. Grandmothered plans do not have to cover EHBs other than preventive care, but if they do provide coverage, they cannot place an annual dollar limit on it.
But grandmothered plans are exempt from some of the main consumer protections and mandates in the ACA. And since all of their members were healthy enough to obtain medically-underwritten coverage between 2010 and 2013, the overall risk pool is still fairly healthy, making the premiums generally lower than unsubsidized premiums for ACA-compliant plans (premium subsidies are not available to offset the cost of grandmothered plans).
31 states allow renewals of grandmother plans
The transitional relief program leaves the final decisions up to states and carriers. There are 31 states where grandmothered individual market plans are still in existence as of 2017.
Virtually all of those states have confirmed that they will go along with the provision to allow grandmothered plans to remain in force until the end of 2018, although carriers can opt to discontinue grandmothered plans instead.
Even if your plan is allowed to renew again for 2018, make sure you take a few minutes to shop around in your state’s exchange to see if there might be a better option available to you. Brokers and navigators in your community can provide assistance – free of charge – if you need it.
Grandmothered plans can renew for 2018 in the following states (most of the states have simply adopted the federal government’s regulations, but some have added additional restrictions) :
- Alabama – But Blue Cross Blue Shield, which had 91% of the individual market in Alabama in 2013, decided not to renew non-compliant plans into 2014.
- Alaska – Premera is the only carrier in Alaska’s individual market that still has grandmothered plans, but they previously said those plans would be terminated at the end of 2017 and replaced with ACA-compliant plans. But the Alaska Division of Insurance confirmed in September 2017 that in light of the latest extension from the federal government, they expect Premera to renew remaining grandmothered plans one more time, through 2018. They noted that there are fewer than 2,000 people who still have grandmothered individual market plans in Alaska.
- Arkansas – The Arkansas Insurance Department confirmed by phone that the state is going along with the February 2017 extension issued by CMS.
- Florida – No bulletin has been issued regarding the extension through 2018, but the Florida Office of Insurance Regulation confirmed by phone that insurers may extend plans in accordance with the latest CMS guidelines.
- Georgia – The state did not issue any official guidance on the more recent extensions, but instead communicated the information directly to the health insurance carriers.
- Hawaii – Plans must be renewed by December 31, 2017; no renewals in 2018 are allowed under the state’s guidance.
- Idaho – Pursuant to a 2016 regulation from the Idaho Department of Insurance, all grandmothered plan renewals on or after August 1, 2016 have policy periods that extend through December 2017, with a consistent premium. So a plan that renewed on August 1, 2016 was renewed for a period of 17 months, with no rate changes during that time. Idaho has also addressed how accumulation periods for out-of-pocket costs will work on renewed grandmothered plans. In going along with the latest extension, allowing plans to remain in force through the end of 2018, Idaho regulators noted that all grandmothered plans that remain in force in 2018 will be on calendar-year renewal schedules, as their previous renewals would have been through December 31, 2017; they will simply be allowed to renew for one more full year after the end of 2017.
- Illinois – Health plans cannot impose additional cost-sharing or premium increases in the final months of 2018. The renewal rates and out-of-pocket amounts that apply to the final renewal must be extended through the end of 2018 if the plan remains in force through the end of 2018.
- Kansas – Plans can remain in force through December 2017; state regulators have not responded to requests for more information regarding the extension through 2018.
- Kentucky – Some carriers had previously indicated that they would not allow grandmothered plans to extend beyond their 2014 renewal date.
- Missouri – The Missouri Department of Insurance had not issued further official guidance on transitional plans, but did provide a letter to Blue Cross Blue Shield of Kansas City regarding the insurer’s intent to exit the ACA-compliant individual market in Missouri while continuing to renew grandmothered and grandfathered plans for 2018)
- New Hampshire – Plans can remain in force through December 2018, but only if they are renew on or before January 1, 2018. No transitional plan renewals will be allowed after January 1, 2018. Plans will have to terminate and be replaced with ACA-compliant coverage as of their first renewal after January 1, 2018, as New Hampshire law does not allow for partial year renewals.
- New Jersey
- North Carolina
- North Dakota – No additional bulletins were issued, but the ND Insurance Department confirmed that the state will follow the latest guidance from CMS. However, Blue Cross Blue Shield of North Dakota terminated all of their grandmothered plans prior to 2015, and they had more than three-quarters of the individual market as of 2013, under the name Noridian.
- Pennsylvania – Pennsylvania has not issued an official bulletin regarding the availability of an extension through December 2018, but the Pennsylvania Insurance Department confirmed by phone that the plans can be renewed again for 2018.
- South Carolina – Eleven carriers opted to go along with the initial transitional relief in 2013, seven in the individual market, and six in the small-group market.
- South Dakota
- Utah – Utah code 31A-30-117(3) allows non-grandfathered health plans to remain in force “to the extent permitted by the Centers for Medicare and Medicaid Services”, so the extension issued by CMS in February 2017 is applicable in Utah).
- Virginia – Legislation was passed in November 2014 that allowed for the renewal of non-ACA-compliant plans according to CMS guidance, but as it was very late in the year by that point, most carriers did not reverse course and allow those plans to renew for 2015. Golden Rule did, although the Bureau of Insurance noted that they were the only individual carrier to do so, and their enrollment is small; the Bureau of Insurance did say that some small group carriers may have extended transitional plans in the state, but they don’t track that.
- Wyoming – Wyoming did not issue a written statement, but the Wyoming Insurance Department confirmed that grandmothered plans can continue to renew.
- Maine – Grandmothered small-group plans can remain in place through December 2018. There are no longer any grandmothered individual market plans in Maine; Anthem was the only individual market carrier in Maine carrier with grandmothered plans, and they discontinued those plans at the end of 2016.
- Montana – State regulators didn’t prohibit renewal of grandmothered plans, although they did encourage carriers to switch to ACA-compliant plans instead of renewing grandmothered plans. Ultimately, all of Montana’s individual market carriers decided to switch to ACA-compliant plans instead of maintaining grandmothered plans.
- Tennessee – The Tennessee Department of Commerce and Insurance confirmed that plans can remain in force through December 2018. However BCBS, which insured 42% of the individual market in 2013, only renewed grandmothered plans through 2014. And notably, BCBSTN also terminated its grandfathered individual market plans at the end of 2015. The Tennessee Department of Commerce and Insurance confirmed that there are no longer any grandmothered individual market plans in Tennessee as of 2017.
- West Virginia – The WV Office of the Insurance Commissioner confirmed that West Virginia is allowing small-group transitional plans to remain in force until as late as December 31, 2018, but only if they are renewed by January 2018. There are no longer any grandmothered individual market plans in West Virginia; they have already been terminated and replaced with ACA-compliant plans instead.
15 states are not permitting renewals
Fifteen states and the District of Columbia have not extended renewals of non-ACA-compliant plans. (In most cases, this was effective as of 2014, although Oregon and Colorado allowed grandmothered plans to remain in force through the end of 2015.)
- California – Grandmothered small-group plans were allowed to remain in force through the end of 2015.
- Colorado – The state allowed renewal through 2015, but not into 2016.
- Connecticut – The state’s insurance commissioner has confirmed the state made no changes after the March 2014 announcement from HHS.
- District of Columbia
- Minnesota – Non-grandfathered plans were required to be updated in order to become compliant with the ACA as of January 1, 2014. Carriers in Minnesota were not permitted to cancel coverage unless they left the market entirely.
- Montana – State regulators didn’t prohibit renewal of grandmothered plans, although they did encourage carriers to switch to ACA-compliant plans instead of renewing grandmothered plans. Ultimately, all individual market carriers decided to switch to ACA-compliant plans, so there are no grandmothered plans in Montana.
- New Mexico – Plans can not be renewed after the end of 2014, but may continue to exist until their 2015 renewal date. At that point, they must be replaced with ACA-compliant plans.
- New York
- Oregon – Grandmothered plans could only remain in force through December 31, 2015.
- Rhode Island
- Vermont – The state allowed 2013 plans to be extended only briefly, until March 31, 2014.