Health Insurance Coverage: Open Enrollment and Health Reform

Some Changes to Your Health Plan Options During Open Enrollment

Filling out enrollment form
Filling out enrollment form. Getty Images/spxChrome/E+

It is very important to understand open enrollment and health reform when dealing with health insurance coverage. 

President Obama signed the Affordable Care Act (ACA) into law in March 2010. Several of the provisions of the ACA that took effect on September 23, 2010 impact group health insurance. Your health plan (or ones you may be considering) will outline in their materials the changes required by the ACA regulations, as well as any changes to your benefits.

It’s important for you to be aware of these changes when you are going through the process of choosing a health plan provided by your employer.

Lifetime Limits

Lifetime limits on health insurance coverage are not allowed.

All group health plans and health insurers that offer group or individual health insurance coverage are prohibited from setting up lifetime limits on the dollar amount of your benefits. If your company is offering you a choice of plans for 2011, you will notice that lifetime limits have been eliminated.

Although a majority of people never hit the lifetime limit, quite a few did, especially people with chronic diseases that are expensive to treat, such as cancer. More than 100 million Americans who had health coverage before September 23, 2010 are impacted by this change.

Annual Limits

Limits on annual coverage amounts have been phased out.

Although much less common than lifetime limits (less than 20 percent of health plans), the consequences for people with medical costs that hit an annual limit can be devastating.

Annual dollar limits on benefits have been phased out, as the ACA now forbids them for most health plans. Your employer or health plan can ask the federal government for a delay, and they may be granted permission if they can show that their current annual dollar limits are necessary to prevent a significant loss of coverage or an increase in premiums.

During open enrollment you may find that your current health plan and some other available health insurance options may have already dropped annual limits completely.

Dependent Coverage Extension to Age 26

You can keep your adult children on your health plan until they are 26 years old. 

All health plans offered by your employer that provide coverage for dependents must offer health insurance to your adult children until the age of 26, even if your adult children no longer live with you, are not dependents on your tax return, or are no longer students. This rule applies to both married and unmarried children, although their spouses and children do not qualify for coverage.

Pre-Existing Condition Exclusions for Children Under Age 19

Your health plan cannot exclude coverage for pre-existing conditions for any of your children under age 19.

The ACA stops health insurance companies from imposing pre-existing condition exclusions on your children. This protection includes sick children who currently do not have insurance and if your child already has coverage, your health plan must cover all your child’s illnesses.

This rule applies to all job-related health care plans as well as individual health insurance policies issued after March 23, 2010. 

Preventive Care with No Cost Sharing

You can get prevention services without any out-of-pocket expenses.

All group health plans (except those that are “grandfathered”) offered by your employer may not impose cost sharing for many routine health prevention services for you and your children, such as immunizations and health screenings.

If you are choosing a new health plan, you will notice that out-of-pocket expenses (deductibles, co-payments, and co-insurance) have been eliminated for approved preventive services.

Depending on your age, these include, for example:

Five Things to Watch Out For During Open Enrollment

Employers are trying to save money, especially during the current economic downturn. One way to do this is to reduce health insurance benefits and shift more of the premium costs to employees. Make sure to carefully read your health plan materials, you may find that your benefits and costs will change for the coming year.

  1. Check to see if your dependents – spouse, partner, and children – are covered. Some plans cover dependents, while other plans do not.
  2. Review any pre-existing condition exclusions and prior authorization requirements required by the plans. Under the health reform legislation, health plans cannot exclude coverage for pre-existing conditions for children under age 19. 
  3. If you take prescription medications, check them against the list of approved drugs in each health plan booklet. Also, if you take expensive brand-name medications, check the copayment that each plan requires.
  4. If you or any family member needs ongoing physical therapy or has a mental health problem that requires therapy, review what your health plan will and will not cover.
  5. Check to make sure that you and your family have adequate coverage for emergencies if you are traveling either in the U.S. or in a foreign country.

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