Health Care Alert: Navigating Health Care Reform (July 8, 2010)
New Grandfathered Plan Rules Have Important Implications for Existing Group Health Plans


The new health care reform legislation (the Patient Protection and Affordable Care Act, as amended by the Health Care & Education Affordability Reconciliation Act (collectively referred to as "PPACA")) imposes requirements on all group health plans. Plans that were in existence on March 23, 2010, however, are given special status ("grandfathered status") and are only subject to some of PPACA's requirements. On June 14, 2010, the Departments of Treasury, Labor, and Health and Human Services (collectively the "Departments") jointly issued interim final rules that clarify what a grandfathered plan is and identify what actions taken by plan sponsors can jeopardize grandfathered status. These interim final rules are effective for plan years beginning on or after September 23, 2010. The rules are summarized below.

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