Grandfathered Health Plans: Everything You Need to Know

According to the Centers for Medicare & Medicaid Services, approximately 14 million people in the United States are currently covered by grandfathered health plans. These plans are often a source of confusion for those shopping for health insurance coverage. If you are among those individuals, then fret no more. In this article, we will provide an in-depth analysis of grandfathered health plans, their benefits, and how they differ from other health insurance plans. We will also provide you with actionable tips that will help you make an informed decision, whether to opt for a grandfathered or other health insurance plans.

What are Grandfathered Health Plans?

Grandfathered health plans are health insurance plans that have been in existence since March 23, 2010. These plans are exempted from certain provisions of the Affordable Care Act (ACA), also known as Obamacare. Essentially, these plans are “grandfathered” in, meaning they are not subject to the same ACA requirements that apply to newer health insurance plans.

Since the ACA was passed in 2010, the law has undergone several changes, and new health insurance plans are required to meet specific benefits and coverage requirements. Despite that, some individuals and employers continue to hold onto grandfathered plans, and insurance companies are still allowed to offer them. However, these plans have certain limitations, and they are not necessarily the best fit for everyone.

What are the Benefits of Grandfathered Health Plans?

Grandfathered health plans have several benefits. One significant advantage of these plans is that they are exempted from some requirements of the ACA. Thus, if you prefer a specific health plan that was grandfathered and do not require services outside of what the grandfathered plan provides, you can keep it. Moreover, grandfathered plans typically have lower premiums than other health plans because they do not offer some of the benefits mandated by the ACA.

Another benefit of grandfathered health plans is that they can offer continuity of coverage. You may have an existing relationship with your health care providers, and by keeping your grandfathered plan, you can maintain that continuity. Additionally, grandfathered plans may offer benefits that are not available in newer plans.

Are there Any Drawbacks to Grandfathered Health Plans?

Despite the benefits of grandfathered health plans, there are some drawbacks that you should be aware of. One significant drawback is that grandfathered plans are not required to meet the ACA’s essential health benefit requirements. This means that they may not offer the same level of coverage as other health plans. For instance, grandfathered plans may not provide maternity care, prescription drug coverage, or preventive services. Additionally, these plans may come with higher out-of-pocket costs, such as co-payments, coinsurance, and deductibles.

Moreover, grandfathered plans are subject to rate increases. Insurance providers can raise rates for grandfathered plans without a limit. This means that you could end up paying more than you would for other health insurance plans that are subject to rate reviews under the ACA.

How are Grandfathered Health Plans Different from Other Health Insurance Plans?

The significant difference between grandfathered health plans and other health insurance plans is their compliance with the ACA. As earlier mentioned, grandfathered health plans are not required to meet the ACA’s minimum requirements for essential health benefits. Newer health insurance plans, on the other hand, must offer comprehensive coverage that includes essential health benefits.

Additionally, insurance providers have the option of discontinuing or modifying grandfathered plans. Insurance providers can update the plan’s benefits or increase the premiums or out-of-pocket costs, making them less advantageous to hold onto. Once you make significant changes to a grandfathered plan, you lose that grandfathered status and are then required to adhere to the ACA’s health insurance requirements fully.

Do Grandfathered Health Plans meet ACA Requirements?

While grandfathered health plans are exempted from some provisions of the ACA, they are still subject to specific mandates. For instance, grandfathered health plans cannot impose pre-existing condition maximum exclusions, and they must provide coverage for specific clinical trials. In addition, these health plans are required to provide automatic coverage for dependent children until they reach the age of 26.

Who Should Consider a Grandfathered Health Plan?

If you are shopping for health insurance coverage and are considering a grandfathered health plan, you should evaluate your needs and preferences. Grandfathered health plans are an excellent option if you like your plan and want to keep it. Moreover, if you have a grandfathered plan that offers the coverage and benefits you need, then you may not need to consider a new health plan. Finally, if you prefer continuity of coverage and maintain a long-term relationship with your health care providers, then a grandfathered health plan may be an excellent option for you.

Who Should Not Consider a Grandfathered Health Plan?

If you need comprehensive coverage with essential health benefits, then a grandfathered health plan might not be the best option for you. Instead, you may want to explore the new health insurance plans that offer comprehensive coverage with essential health benefits.

Additionally, if you are worried about rate increases, then a grandfathered plan may not be the best fit for you. Newer health insurance plans are subject to rate reviews under the ACA, meaning you can contest a rate increase if it is unjustifiable.

How Can US Health Insurance Options LLC Help?

Shopping for health insurance can be a complicated and challenging task, and choosing the right plan can make a significant difference in your health care needs and finances. That is why US Health Insurance Options LLC is here to help.

You do not need to navigate the health insurance marketplace alone. Our licensed and experienced agents are always ready to assist you in making an informed decision. We will work with you to evaluate your preferences, needs, and budget and help you compare plans across various providers to help you make the right decision. Contact us today and let us help you find the best health insurance plan that fits your unique needs.

Resources

Grandfathered Health Plans

Get information about grandfathered health plans, what they are, who can enroll, and how they compare to other health insurance plans.

Florida Medicaid

Learn about Florida Medicaid programs and services.

Florida Medicare

Get information about Florida Medicare, Medicare Supplement Insurance (Medigap) policies, and Medicare Prescription Drug Coverage (Part D) plans.

Conclusion

Grandfathered health plans are health insurance plans that were in existence before the passage of the Affordable Care Act. While they may have some benefits, they are not necessarily the best fit for everyone. It would be best to evaluate your needs, preferences, and budget before deciding whether to enroll or switch to a grandfathered health plan.

If you need help shopping for health insurance, contact us at US Health Insurance Options LLC today. Our licensed agents are highly experienced and will work with you to make an informed decision. Together, we will help you find the best health insurance plan that fits your specific needs and budget.