What is a Minimum Value Plan?

Coverage that has an actuarial value (AV) of at least 60%. AV is the plan’s share of the total allowed cost of benefits provided to an enrolled individual

  • Example, if a plan has an AV of 60% then the individual is theoretically responsible for 40% of the costs for all covered benefits (in addition to the monthly premium) and the plan will pay 60%

The Minimum Value of a group health plan is calculated by dividing anticipated covered spending by total anticipated allowed charges for Essential Health Benefits coverage

  • How much an individual spends could be a higher or lower percentile, depending on actual health care needs

ACA Plan Requirements

Requirements apply to both Small and Large Employers

1. Maximum of 90 Day Waiting Period – beginning in 2014 – Employment-Based Orientation Periods were recently introduced, however they cannot Exceed One Month for Purposes of 90-Day Waiting Period Limit.

2. Plan Design Requirements – effective dates vary

  • Benefits mandates (e.g. women’s preventive care, clinical trials)
  • Eliminate pre-existing condition exclusions
  • Eliminate annual limits on essential health benefits
  • Cost sharing cannot exceed HDHP levels, $6,350 for self-only and $12,700 for family coverage in 2014. ($6,600 / $13,200 in 2015.)

3. Deductible and out-of-pocket limits in the small group markets

  • Recent legislation signed eliminates the Affordable Care Act’s annual limitation on deductibles. Those limits were set at $2,000 for employee only coverage and $4,000 when adding a dependent(s); however, certain small group plans were allowed to exceed the limits if necessary to reach a given level of coverage, or metal tier.
  • The annual limitation on out-of-pocket expenses for non-grandfathered group plans was not eliminated.  Annual out-of-pocket expenses (including coinsurance and copayments, but not premiums) for a plan year beginning in 2014 may not exceed $6,350 for self-only coverage or $12,700 for other than self-only coverage. For 2015, these limits increase to $6,600 and $13,200, respectively.
  • Out-of-pocket costs must include all co-pays/deductibles/co-insurance and RX co-pays