CMS recently released guidelines for transitional group health policies under the Affordable Care Act. This impacts any health insurance plan that is considered grandmothered. A grandmothered group health plan had an effective date prior to 2014. These group plans should cost less than current market options and that is why these new rules are important.

The guidance from CMS and the approval by the Indiana insurance commissioner, has created some interesting scenarios for renewal dates they are the following:

Group health plans renewing July 1st 2016- October 1st 2016

  • Most carriers are going to give a standard 12 month renewal.
  • Then in 2017, the group will be given the option of a short renewal to Jan. 1st 2018.
  • The group plan at that time will be moved to a nACA group policy.

Groups renewing November 1st 2016 and December 1st 2016

  • These companies will have the option to move the renewal date to October 1st.
  • In order to keep the grand mothered status until January 1st 2018, group plans will have to have a changer the renewal date to October 1st.

Since 2014, small group health plan in Indiana have had to change effective dates multiple times. This has to do with the Indiana department of Insurance, under ERISA guidelines, not allowing small group health insurance to have a an renewal cycle longer than 12 months.