Does Obamacare Place Limits on Co-Payments and Deductibles? – YES
General Reference (not clearly pro or con)
The Patient Protection and Affordable Care Act, Section 1302(c), “Requirements Related to Cost-Sharing,” page 47-48, signed into law on Mar. 23, 2010, available at the Library of Congress website, states:
“(1) ANNUAL LIMITATION ON COST-SHARING.—
(A) 2014.—The cost-sharing incurred under a health plan with respect to self-only coverage or coverage other than self-only coverage for a plan year beginning in 2014 shall not exceed the dollar amounts in effect under section 223(c)(2)(A)(ii) of the Internal Revenue Code of 1986 for self-only and family coverage, respectively, for taxable years beginning in 2014.
(B) 2015 AND LATER.—In the case of any plan year beginning in a calendar year after 2014, the limitation under this paragraph shall—
(i) in the case of self-only coverage, be equal to the dollar amount under subparagraph (A) for self-only coverage for plan years beginning in 2014, increased by an amount equal to the product of that amount and the premium adjustment percentage under paragraph (4) for the calendar year; and
(ii) in the case of other coverage, twice the amount in effect under clause (i). If the amount of any increase under clause (i) is not a multiple of $50, such increase shall be rounded to the next lowest multiple of $50.
(2) ANNUAL LIMITATION ON DEDUCTIBLES FOR EMPLOYER-SPONSORED PLANS.—Mar. 23, 2010 - Patient Protection and Affordable Care Act (HR 3590)
(A) IN GENERAL.—In the case of a health plan offered in the small group market, the deductible under the plan shall not exceed—
(i) $2,000 in the case of a plan covering a single individual; and (ii) $4,000 in the case of any other plan. The amounts under clauses (i) and (ii) may be increased by the maximum amount of reimbursement which is reasonably available to a participant under a flexible spending arrangement described in section 106(c)(2) of the Internal Revenue Code of 1986 (determined without regard to any salary reduction arrangement).
(B) INDEXING OF LIMITS.—In the case of any plan year beginning in a calendar year after 2014—
(i) the dollar amount under subparagraph (A)(i) shall be increased by an amount equal to the product of that amount and the premium adjustment percentage under paragraph (4) for the calendar year; and
(ii) the dollar amount under subparagraph (A)(ii) shall be increased to an amount equal to twice the amount in effect under subparagraph (A)(i) for plan years beginning in the calendar year, determined after application of clause (i). If the amount of any increase under clause (i) is not a multiple of $50, such increase shall be rounded to the next lowest multiple of $50.”
[Editor’s Note: On Feb. 20, 2013, the US Department of Labor (DOL) announced a delay of the implementation of the cost-sharing limits for group health plans or group health insurance issuers that use more than one service provider to administer benefits. Instead of taking effect on Jan. 1, 2014, the implementation has been delayed until Jan. 1, 2015.]
Robert Pear, MPhil, New York Times Domestic Correspondent, stated the following in his Aug. 12, 2013 article “A Limit on Consumer Costs Is Delayed in Health Care Law,” available at nytimes.com:
“[T]he administration has delayed until 2015 a significant consumer protection in the law [Patient Protection and Affordable Care Act] that limits how much people may have to spend on their own health care.
The limit on out-of-pocket costs, including deductibles and co-payments, was not supposed to exceed $6,350 for an individual and $12,700 for a family. But under a little-noticed ruling, federal officials have granted a one-year grace period to some insurers, allowing them to set higher limits, or no limit at all on some costs, in 2014…
Under the policy, many group health plans will be able to maintain separate out-of-pocket limits for benefits in 2014. As a result, a consumer may be required to pay $6,350 for doctors’ services and hospital care, and an additional $6,350 for prescription drugs under a plan administered by a pharmacy benefit manager.
Some consumers may have to pay even more, as some group health plans will not be required to impose any limit on a patient’s out-of-pocket costs for drugs next year. If a drug plan does not currently have a limit on out-of-pocket costs, it will not have to impose one for 2014.”
The United Methodist Church General Board of Pension and Health Benefits stated the following in its Mar. 19, 2013 publication “Health Care Reform – Essential Health Benefits, Cost-Sharing Limits and Minimum Value,” available at gbophb.org:
“Annual Deductible Limit: Beginning in 2014, the annual deductible for a health plan in the individual or small group market may not exceed $2,000 for self-only coverage and $4,000 for family coverage. For plans using provider networks, an enrollee’s cost-sharing for out-of-network benefits does not count toward the annual deductible limit. HHS will increase the annual deductible limits annually. This annual deductible limit applies only in the fully-insured individual and small group markets. Thus, the limit does not apply to HealthFlex, other self-insured annual conference plans or fully-insured annual conference plans in the large group market (large group plans typically cover more than 50 employees).
Out-of-Pocket Maximum: Beginning January 1, 2014, the ACA places annual limits on total participant cost-sharing for EHBs [essential health benefits]. Once the limitation on cost-sharing (i.e., the out-of-pocket maximum) is reached for the year, the participant is not responsible for additional cost-sharing for the remainder of the year. The ACA’s out-of-pocket maximum applies to all non-grandfathered health plans and group health plans. This would include, for example, self-insured health plans and fully-insured health plans of any size in any market. The out-of-pocket maximums will apply to HealthFlex and self-insured annual conference plans.”
The US Department of Labor (DOL) stated the following in its Feb. 20, 2013 “FAQs about Affordable Care Act Implementation Part XII,” available at dol.gov:
“[T]he Affordable Care Act, provides that a group health plan shall ensure that any annual cost-sharing imposed under the plan does not exceed the limitations provided for under section 1302(c)(1) and (c)(2) of the Affordable Care Act. Section 1302(c)(1) limits out-of-pocket maximums and section 1302(c)(2) limits deductibles for employer-sponsored plans…
The HHS final regulation on standards related to essential health benefits implements the deductible provisions described in section 1302(c)(2) for non-grandfathered health insurance coverage and qualified health plans offered in the small group market, including a provision implementing section 1302(c)(2)(C) so that such small group market health insurance coverage may exceed the annual deductible limit if it cannot reasonably reach a given level of coverage (metal tier) without exceeding the deductible limit…
The Departments recognize that plans may utilize multiple service providers to help administer benefits (such as one third-party administrator for major medical coverage, a separate pharmacy benefit manager, and a separate managed behavioral health organization). Separate plan service providers may impose different levels of out-of-pocket limitations and may utilize different methods for crediting participants’ expenses against any out-of-pocket maximums…
The Departments have determined that, only for the first plan year beginning on or after January 1, 2014, where a group health plan or group health insurance issuer utilizes more than one service provider to administer benefits that are subject to the annual limitation on out-of-pocket maximums under section 2707(a) or 2707(b), the Departments will consider the annual limitation on out-of-pocket maximums to be satisfied if both of the following conditions are satisfied:
The plan complies with the requirements with respect to its major medical coverage (excluding, for example, prescription drug coverage and pediatric dental coverage); and
To the extent the plan or any health insurance coverage includes an out-of-pocket maximum on coverage that does not consist solely of major medical coverage (for example, if a separate out-of-pocket maximum applies with respect to prescription drug coverage), such out-of-pocket maximum does not exceed the dollar amounts set forth in section 1302(c)(1).”
[Editor’s Note: Based upon a neutral reading of the Patient Protection and Affordable Care Act and bi-partisan third party analysis, this question seems to have a clear and obvious Pro (yes) answer, and ProCon.org has therefore presented the responses in a single column with no opposing perspective.]