Friday, February 8, 2019

2019 ACA compliance overview — Plan design changes

The Affordable Care Act has made significant changes to group health plans since it was enacted in 2010. Many of these key reforms became effective in 2014 and 2015, including health plan design changes, increased wellness program incentives and employer shared responsibility penalties.

Changes to some ACA requirements, such as increased dollar limits, take effect in 2019 for employers sponsoring group health plans. To prepare for 2019, employers should review upcoming requirements and develop a compliance strategy.

This article provides an overview of plan design changes for grandfathered plans and an update on FSA contributions.

Plan design changes — grandfathered plan status

A grandfathered plan is one that was already in existence when the ACA was enacted on March 23, 2010. A plan may maintain its grandfathered status as long as no prohibited changes are made. Once a plan relinquishes grandfathered status it cannot be regained and the plan must comply with additional ACA requirements.

CHECKLIST: Review your plan’s grandfathered status

  • If you have a grandfathered plan, determine whether it will maintain its grandfathered status for the 2019 plan year. Grandfathered plans are exempt from some ACA mandates. A grandfathered plan’s status will affect its compliance obligations from year to year. 
  • If your plan will lose its grandfathered status in 2019, confirm that the plan has all of the additional patient rights and benefits required by the ACA for non-grandfathered plans. This includes, for example, coverage of preventive care without cost-sharing requirements. 
  • If your plan will keep its grandfathered status, continue to provide the Notice of Grandfathered Status in any plan materials provided to participants and beneficiaries that describe the benefits provided under the plan (such as the plan’s summary plan description and open enrollment materials). Model language is available. 

Plan design changes — Health FSA contributions

Effective for plan years beginning on or after Jan. 1, 2013, an employee’s annual pre-tax salary reduction contributions to a health flexible spending account must be limited to $2,500 (as adjusted for inflation). The $2,500 limit was increased to $2,550 for taxable years beginning in 2015 and 2016, then increased to $2,600 for taxable years beginning in 2017, increased to $2,650 for taxable years beginning in 2018 and then increased again to $2,700 for taxable years beginning in 2019.

The limit does not apply to non-elective employer contributions to the health FSA (such as matching contributions or flex credits), though employer contributions that employees may elect to receive in cash or as a taxable benefit will count toward the limit. Other ACA requirements may impact or limit the total amount that may be contributed to a health FSA, but non-elective employer contributions generally do not reduce the health FSA limit for the employee. Additionally, the health FSA limit does not impact contributions under other employer-provided coverage. For example, employee salary reduction contributions to an FSA for dependent care or adoption care assistance are not affected by the health FSA limit.


This summary is a high-level overview of some ACA plan design changes. It does not provide an in-depth analysis specific to your organization. If you have any questions or would like to begin talking to an employee benefits consultant, please get in touch by email or by calling (800) 388-1963.

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