News and Commentary

More Waivers Issued for Limited-Benefit Plans

MANAGED CARE May 2011. ©MediMedia USA

The number of one-year waivers for limited benefit (mini-med) health plans continues to rise, reports the Department of Health and Human Services (HHS). The total was 1,168 at the end of March. HHS saw an increase in the number of applications for waivers at the end of 2010 because December 1 was the final day to apply for a waiver for a health plan or policy year that began January 1.

Because limited-benefit plans are often the only type of private coverage available to some workers, HHS issues temporary waivers to allow workers to keep their coverage. These waivers last for only one year and are only available if the plan certifies that the waiver is necessary to prevent either a significant increase in premiums or decrease in access to coverage.

The Affordable Care Act (ACA) bans annual dollar limits beginning in 2014. That’s when Americans will have access to affordable, comprehensible health insurance plans that cannot use high deductibles or annual limits to curtail benefits (at least that is the law’s intention). For plan years starting between Sept. 23, 2010 and Sept. 22, 2011, plans may limit annual coverage of essential benefits such as hospital, physician, and pharmacy benefits to less than $750,000.

HHS says that of the waivers granted so far, more than 95 percent were issued for employment-related health plans. The number of enrollees in plans with limited benefits is 2.93 million, less than 2 percent of all Americans who have private health insurance.

Other key facts collected by HHS:

  • 359 waivers for self-insured, employer-based health plans were issued;
  • 182 waivers were issued for collectively-bargained plans. These are group health plans negotiated between a union and two or more employers; and
  • 171 waivers were issued for health reimbursement arrangements (HRAs), which are employer-funded group health plans.

HHS reports that 16 waivers were granted to health insurers that applied for waivers for multiple mini-med products sold to employers or individuals, and that four waivers were granted to state governments.

MANAGED CARE May 2011. ©MediMedia USA