As you must know by now, regardless of how the U.S. Supreme Court rules on the federal health care reform, a couple of very large insurers announced they would continue several of health reform’s insurance mandates.
The impact of this announcement directly applies to companies that buy full insurance. But self-insured plans and employers big enough to negotiate exceptions to off-the-shelf products will certainly have carve-out options if the insurance reform mandates go down.
Impacts on Fully Insured Plans
There’s still a question about whether fully insured employers can save money anyway, by telling their insurer to carve out health mandates such as dependent care to age 26, preventive care with no out-of-pocket costs, no lifetime limits on essential benefits, and no rescissions on coverage except in the case of fraud or misrepresentation.
The big insurers may decide not to give employers that buy an off-the-shelf product any choice to carve out those benefits. Time will tell, according to an employee benefits advisor Amy Gallagher with Cornerstone Group in Warwick, R.I.
Plans Still May Drop Provisions (But They Probably Won’t)
Self-insured health plans do not have to follow suit: They will be free to drop the insurance mandates if the Supreme Court strikes those elements.
Gallagher predicts that self-insured plans will not repeal preventive care with no cost-sharing and dependent care to age 26, for several reasons.
- Preventive care is relatively cheap benefit, and improves health outcomes by treating people when they’re healthy rather than when they are sick. To repeal preventive care would go against the strong trend toward early treatment and a stronger primary care provider-patient relationship.
- Dependent coverage to age 26 will continue because of the lagging economy, Gallagher says. Young people are graduating college and not landing jobs that provide health benefits.
Therefore, in both cases, self-insured plans would continue to offer such coverage as a recruitment and retention tool.