What does it mean for a health care plan to be “grandfathered” under the new law and what is required?
Government guidance is still forthcoming on this provision. The health care reform law exempted — or “grandfathered” — employer health care plans in effect on March 23, 2010, from most, but not all, new requirements. The grandfather provision is not clearly articulated in the final language of the law, but we know that these plans appear to be exempt for an indefinite period of time. It is not clear to what extent the grandfather provision allows employers to make changes to their plans without jeopardizing their grandfather status. It looks like the provision also allows for such plans to take on new enrollees, new hires and perform similar plan maintenance, without undercutting their grandfather status. But with so sweeping a grandfather provision, it is possible that the U.S. Department of Health and Human Services will issue regulations that could chip away at the flexibility of grandfathered plans.
