The U.S. Departments of Labor, Health and Human Services, and the Treasury have jointly issued a new set of FAQs that clarifies the application of the rules establishing cost-sharing limits. For 2016, non-grandfathered group health plans must cap the amount that plan participants pay in deductibles, copayments, coinsurance and the like at $6,850 for self-only coverage and $13,700 for coverage other than self-only coverage.


The new guidance clarifies that the $6,850 limit applies to each individual, whether the individual is enrolled in self-only coverage or coverage that includes one or more family members. This clarification applies to all non-grandfathered plans, including health plans in the small or large group insurance market, self-funded health plans, and high deductible health plans. However, the guidance offers relief for plans that have not applied the rule in this manner to date, stating that the clarification will apply to plan years beginning in 2016 or later.

Thus, it appears that the government will not treat a plan as violating the rule in 2015 if, for example, the plan did not apply cost-sharing limits where a family covered under the plan incurred $10,000 in out-of-pocket expenses, even if $9,000 of those expenses are attributable to one dependent. In 2016, the plan would need to cover an additional $2,150 ($9,000 – $6,850) of that dependent’s expenses.

The FAQs also announced that no enforcement actions will be taken against a group health plan or insurer that complies with a reasonable, good faith interpretation of the Affordable Care Act’s provider nondiscrimination rules. These rules prohibit health insurers from discriminating against a provider acting within the scope of the provider’s license, but expressly provide that they do not require a group health plan or insurer to contract with any provider willing to meet the conditions for network participation and do not prohibit reimbursements based on quality or other performance measures.

As the federal health care reform effort gained steam, Ballard Spahr attorneys established the Health Care Reform Initiative to monitor and analyze legislative developments. With federal health care reform now a reality, our attorneys are assisting health care entities and employers in understanding the relevant changes and planning for the future. They also have launched the Health Care Reform Dashboard, an online resource center for news and analysis on developments under the Affordable Care Act.

If you have questions about this guidance, contact Edward I. Leeds at 215.864.8419 or or any other member of our Employee Benefits and Executive Compensation Group with whom you regularly work.