April 28, 2016
Under new guidance from Centers for Medicare and Medicaid Services (CMS), small groups (2-50 total employees) with transitional (also called grandmothered) plans have the option to extend their current transitional plans through 12/31/17.
Under this new guidance, all current transitional policy plans must renew on or before 10/1/17, and end coverage by 12/31/17. The Indiana Department of Insurance (DOI) has agreed to this extension. This extension allows impacted groups to keep the plan they’re familiar with and gives you more time to help them evaluate their options.
Here’s what to expect
Anthem will continue to renew small group (2-50) transitional policies through 12/31/17. The options outlined below will allow these groups to remain on their current transitional plan through 12/31/17. Of course, they may decide at any time to move to an ACA plan instead. But, remember, once they terminate their current transitional group plan, they cannot move back to a transitional plan.
- For groups with 2015 renewals on July 1, August 1, September 1, or October 1: For their 2016 renewals, groups will be offered a 12-month renewal of their transitional policy. At their 2017 renewal, they may renew their transitional policy through 12/31/17.
- For groups with 2015 renewals on November 1 or December 1: Anthem sent impacted groups a letter last year with an option to move their plan year anniversary date to 10/1/16 so they could stay on their transitional plan as long as possible (based on prior CMS transitional policy guidance). Many groups told us they did want a 10/1 renewal date. Because the CMS and DOI guidance has changed, it is no longer necessary for groups to change their plan year renewal date to 10/1/16. As a result, Anthem will allow them to remain on their current transitional plan for the full 12 months (rather than moving their renewal date up to 10/1/16), unless they inform us differently. Groups with an 11/1 or 12/1 renewal will need to move to a 10/1/17 plan year renewal date in 2017 to have the option to stay on a transitional plan as long as possible. If they told us to change their renewal date to 10/1, we will do that for their 10/1/17 renewal.
- For their 2016 renewal, we will offer them, effective on 11/1/16 or 12/1/16, a 12-month renewal of their transitional policy.
- In 2017: If they told us, or tell us by 4/1/17 that they want to move to a 10/1 plan year renewal date, we will offer a renewal on 10/1/17 of their transitional policy through 12/31/17. If they have not and do not tell us by 4/1/17 that they want to move to a 10/1 plan year renewal date, we will not renew their transitional policy, but we will offer a 12-month ACA-compliant plan.
Note: Renewal rates may change since a group’s last renewal. This is due to adjustments in base rate, demographic and risk adjustment factors. Additionally, in compliance with the Affordable Care Act (ACA) rules, changes to deductibles and out of pocket costs are not allowed if groups want to retain their transitional plan.
Are there other options?
Yes, small groups (2-50) who don’t want to keep their current transitional plan may choose from other coverage options including:
- Move to an ACA-compliant group plan upon their 2016 renewal; or
- Renew their transitional plan upon their 2016 renewal and then move to an ACA-compliant plan at their 2017 renewal.
Please be aware that once a group shifts to an ACA-compliant plan, they will not be able to switch back to a transitional plan.
What about dental, vision, life and disability coverage that my clients have with Anthem?
If a group elects to change their renewal date, any dental, vision, life and disability benefits will follow suit.
When will renewals be released?
Renewal packets will be mailed to groups approximately 60 days prior to their renewal date.
How is Anthem communicating this information to my clients?
We will be sending this employer notification letter to small groups (2-50) with transitional plans to inform them of this new guidance and to explain their renewal options.
Please contact firstname.lastname@example.org with any questions.
This article applies to:
- Small Group