Feds firm on out-of-pocket limits

Dive Brief:

  • According to a regulatory guidance issued in May by HHS and the departments of Labor and Justice, the maximum out-of-pocket expenses employers can require employees to pay prior to health coverage is $6,850 for individuals and $13,700 for families. 
  • The rule will go into effect next year. 
  • Opponents argue such an "embedded" cost limit was not supported by the healthcare reform law. However, Kevin Counihan, Marketplace CEO at HHS wrote to opponents the embedded limit "prevents consumers from being penalized for purchasing family coverage rather than self-only coverage." 

Dive Insight:

The biggest impact of the new rule, according to Business Insurance, will be on employers with high-deductible plans. A survey by Aon Hewitt earlier this year found only 17% of large and mid-sized employers that offer high-deductible healthcare plans with health savings accounts had an embedded out-of-pocket limit.

Annette Guarisco Fildes, president and CEO of the ERISA Industry Committee said, "We were hopeful that the administration would reconsider their position on out-of-pocket limits in light of the harm this does to group health plans and the millions of workers and family members covered by them. This position will force many companies to raise premiums to offset this required plan design change." 

Filed Under: Finance Policy & Regulation