Certain PPACA Provisions Will No Longer Apply to U.S. Territories
July 22, 2014
On July 16, the Department of Health & Human Services (HHS) notified U.S. territories (Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa and the Northern Mariana Islands) that the following Patient Protection and Affordable Care Act (PPACA) provisions will no longer apply to insured plans sitused in the territories:
- Required coverage of Essential Health Benefits (EHB)*
- Medical Loss Ratio (MLR) rebates
- Reinsurance assessment fees
- Employer mandate (a territory may enact a comparable provision under its own law)
- Guaranteed issue
- Rate review*
- Community rating*
- Single risk pool*
- Risk corridors and risk adjustment*
* Applies to individual and small group insured plans
The change applies prospectively only, effective July 16, 2014.
The following provisions will continue to apply to health plans issued in the U.S. Territories:
- 100% coverage for preventive care
- Dependent coverage to age 26
- Summary of Benefits and Coverage (SBC)
- Individual mandate (although residents of the territories are deemed to have minimum essential coverage even if they are not enrolled in health coverage)
- Reporting requirements for employers and insurers
- No limits on coverage for pre-existing conditions
- 90-day maximum waiting period
- Coverage for clinical trials
- No annual or lifetime dollar limits on Essential Health Benefits
- Guaranteed renewability
- Ban on rescission of coverage
- Required appeals process
- No discrimination based on health status
- Non-discrimination against health care providers
- Discrimination in favor of highly compensated individuals
- Patient protections, e.g., doctor choice including direct access to OB/GYNs
HHS intends to reflect its decision in future regulations. In the meantime, insurers and employers can make changes based on this announcement.
HHS issued an identical letter to each territory. A link to the Puerto Rico letter is included below.
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