Extension of Renewal for Grandmothered Plans

On April 18, 2017, the Maine Bureau of Insurance published Bulletin 428 (superseding Bulletin 420). According to the bulletin, the Bureau approves the renewal of non-grandfathered small group plans issued before Jan. 1, 2014 (so-called “grandmothered plans”) for terms extending no later than Dec. 31, 2019.

As background, on April 9, 2018, CMS issued guidance allowing extension of grandmothered policies (i.e., non-ACA-compliant plans that have been continued since 2013), subject to state and carrier approval. Bulletin 428 represents Maine’s approval for such an extension.

To be eligible for the extension, carriers must notify the bureau by May 31, 2018, whether or not they intend to renew grandmothered policies beyond Oct. 1, 2018. The notice must include the number of affected policies and whether the carrier requests discontinuance of any existing products before Dec. 31, 2019. In addition, grandmothered policies must be terminated or modified to be fully ACA-compliant by Jan. 1, 2020. For non-calendar-plan years, carriers may renew the policy early – on Jan. 1, 2019 – or may renew it on its anniversary date in 2019 for a short policy term.

In addition, and importantly for employers with grandmothered policies, carriers must provide 90 days’ notice of transitional renewal or product discontinuance/modification to all grandmothered policyholders. That means any affected employers should receive at least 90 days’ notice with respect to changes to their grandmothered plans.

Maine small employers that have grandmothered plans and are interested in renewing should work with their advisors and insurers.

Bulletin 428 »