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Out-of-pocket maximum (OOPM) mid-year plan change credit

On Jan. 1, 2014, the Affordable Care Act (ACA) required carriers to ensure that any annual cost-sharing imposed under the plan doesn't exceed the out-of-pocket maximum limits. In July 2015, legal clarification was provided on mid-year plan changes and the accumulation credit requirements.

A mid-year plan change is defined as a plan change that occurs when a group enrolls mid-year or enrolls with Regence prior to (and instead of) its regularly scheduled renewal with its prior carrier. The group would obtain credit for prior deductible and OOPM met. In- and out-of-network accumulation applicability will vary on a case-by-case basis.

Mid-year plan change accumulation credits allowed

Mid-year plan change credit will apply to the in-network deductible and in-network OOPM when the new Regence plan has separate in/out-of-network accumulators. When the new Regence plan has a single set of in/out-of-network accumulators, the in- and out-of-network deductible and OOPM accumulations will be credited from the prior plan.

Administrative service contract (ASC) groups that have cross-accumulation plan designs will follow the existing practice when crediting the accumulations. In- and out-of-network deductible and OOPM accumulations will be credited at the same time. Cross-accumulation plans have separate in- and out-of-network benefits, so in-network may reduce out-of-network and vice versa, depending on contract language. 

What are your requirements as a producer?

The producer and sales representative identify whether the group is a mid-year plan change. The sales representative will use our Policy and Procedures document to determine groups' eligibility for accumulations credits.

The producer and employer are responsible for working with the prior carrier or third party administrator to obtain the mid-year accumulation report, if eligible.

The initial accumulation report is required within 90 days of group's effective date. If the 90-day requirement is exceeded, sales management approval is required.

Up to three accumulator reports from the prior carrier can be received within the first six months; one initial and two additional run-out reports.

The producer is responsible for issuing the group report to their Regence sales representative once received.

How do you determine if a group is a mid-year plan change?

If the group was on a calendar-year accumulation period, we'd credit the months from January to the effective date with Regence. For example, calendar-year groups that satisfy a Jan. 1 – Dec. 31 contract wouldn't receive accumulation credits. However, if they moved to Regence mid-year, we'd credit any in-network accumulations from Jan. 1 to the effective date of the new Regence contract. This may vary depending on the plan design. If the group was on a plan-year accumulation period, there may be multiple scenarios to account for.

Below are a few possible scenarios. Please note that this isn't an all-inclusive list.

Scenario 1: Plan-year group satisfies its contract with the prior carrier that had a plan-year accumulation period.

Outcome: Regence wouldn't be required to credit any of the accumulations met during the current calendar year if the group continues a plan-year accumulation period.

Example: The group was a Sep. 1 - Aug. 31 plan-year group. Then, as of Sep. 1 they move to Regence as a new policy.

Scenario 2: Plan-year group satisfies its contract with prior carrier that had a plan-year accumulation period. Group renews with a calendar-year accumulation period.

Outcome: Regence would be required to credit accumulations met during the current calendar year.

Example: The group was a Sep. 1 - Aug. 31 plan-year group. As of Sep. 1 they renew as a calendar-year accumulation period with Regence. Regence would credit any in-network accumulations from Jan. 1 to Aug. 31. This may vary depending on the plan design.

Scenario 3: Plan-year group doesn't satisfy its contract with the prior carrier and renews with Regence.

Outcome: Prior accumulations met during the plan year will be credited from the group's effective date to the termination date regardless of accumulation period election with Regence.

Example: The group had a Sep. 1 - Aug. 31 plan-year contract and left its carrier effective March 1. Regence would credit any in-network accumulations from Sep. 1 to Feb. 28. This may vary depending on the plan design.

If you have any questions, please talk to your Regence Sales contact.