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More Than 1,000 Annual Benefit Limit Waiver Applications Have Been Granted

March 10, 2011
2 minute read

According to the U.S. Department of Health and Human Services’ Center for Consumer Information & Insurance Oversight (CCIIO), as of March 1, 2011, a total of 1,040 one-year annual benefit limit waivers have been granted. The Affordable Care Act requires insurers to gradually phase out the use of annual dollar limits on essential health coverage by 2014. For example, in 2011, most plans can impose an annual benefit limit of no less than $750,000. Restrictions on benefit limits particularly impact limited benefit plans known as “mini med” health plans that usually offer low-cost coverage but often include annual limits below the required threshold. To preserve such plans, which are usually used by low-wage, part-time, and seasonal employees, the HHS’s interim federal regulations set forth a program whereby the restricted annual limit requirements would be temporarily waived if compliance with the restrictions would result in a significant decrease in access to benefits or a significant increase in premiums. This waiver program will be in place until 2014.

As stated in information provided by the CCIIO:

Of all the waivers granted to date, the vast majority – more than 95 percent of all waivers – were granted to health plans that are employment-related. These include self-insured employer health plans, health reimbursement arrangements, collectively-bargained multi-employer plans, and health plans sold by issuers to fully-insured employers.
The number of waivers processed each month continues to decline. After granting over 500 waivers in December (an increase related to the fact that December 1 was the final day to apply for a waiver for a plan or policy year that begins on January 1, as many plans do), HHS granted less than 200 waivers in January, and 126 in February.
The number of enrollees in plans with annual limits waivers is 2.62 million, representing less than 2 percent of all Americans who have private health insurance today.

The categories and numbers of approved waiver applicants are as follows:

Self-Insured Employers (423)
Health Reimbursement Arrangements (322)
Multi-Employer Plans (237)
Non-Taft Hartley Union Plans (23)
Health Insurance Issuers (29)
State-Mandated Policies (4)
Association Plans (2)

More information on the criteria the HHS uses to evaluate the waiver applications can be found here. (pdf) Guidance on the application process itself can be found here. (pdf)

This entry was written by Ilyse Schuman.