HHS issues guidance on waivers from healthcare reform's annual limits

By Julian Pecquet - 09/07/10 01:42 PM ET

The Department of Health and Human Services has released guidance for health plans seeking a waiver from the healthcare reform law's restrictions on plans' ability to place annual limits on essential health benefits.

The new law creates temporary restrictions on health plans starting Sept. 23. But the law also allows the annual limits to be waived "if compliance ... would result in a significant decrease in access to benefits or a significant increase in premiums."

The guidance, quietly issued Friday, applies only to plan years beginning between Sept. 23, 2010, and Sept. 22, 2011. The waiver is only valid for one year, and plans must reapply annually "in accordance with future guidance from HHS."

The restrictions, established June 28, state that annual limits cannot be lower than:

• $750,000 for plan years beginning between Sept. 23, 2010, and Sept. 22, 2011;

• $1.25 million for plan years beginning between Sept. 23, 2011, and Sept. 22, 2012;

• $2 million for plan years beginning between Sept. 23, 2012, and Dec. 31, 2013.

Starting Jan. 1, 2014, annual limits won't be allowed except for grandfathered individual market policies.