What is “Grandmothering” and How It Will Impact You?

There is a new term starting to be used called “grandmothering” by business owners and controllers of companies with less than 50 employees.

Grandmothering, is the term that the federal government is using to extend current non-Affordable Care Act policies until 2016.

On March 5th 2014, the United States Department of Health and Human Services issued the “Extension of Transitional Policy”, which will allows small groups and individuals to keep non-grandfathered plans for two more years, with renewals on or before October 1, 2016.  On March 31st the state of Indiana agreed to allow this extension.

How does this impact you?

If you are running a group health plan that elected the early renewal, you may have the extension of that plan until 2016. You will still have a renewal process but you should see a small rate increase.  How can I predict your rate increases being low?  The groups that are left on the early renewals are running well from a claims standpoint. The insurance carriers do not want to lose accounts that are profitable.  It’s an assumption, but I think it is accurate. Most small companies may want to take this offer.

Individual Plans and Grandmothering

I can’t predict what decision the carriers are going to make regarding the individual plans. We could see some carriers offering the grandmothering and others opting not to.

If you are able to take the grandmothering of your current individual plan, it may be in your best interest.  Now if you qualify for tax credits on the exchange, you may want to contact me to get those rates and plan designs.

We should have more official statements from all the carriers in the next couple of weeks.

As always, feel free to contact me with any questions you may have regarding grandmothering or health insurance in general.

Anthony  Nefouse

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