The end of the 2011 plan year brings about another opportunity to review group health plan compliance with Patient Protection and Affordable Care Act (PPACA) requirements. This LawFlash describes yearend action items for group health plan sponsors and previews upcoming changes for 2013. This list is not exhaustive, but it is intended to serve as a reminder of items that plan sponsors should review and consider before the end of the year.

Plan sponsors of grandfathered plans must assess whether 2012 plan design changes will impact the plans’ grandfathered status. For example, grandfathered plan status is lost if any increase is made to the percentage of cost sharing borne by a participant or if a co-pay increases by more than $5 (from the co-pay in place when healthcare reform was enacted, not from the prior year). These and other plan changes having a negative impact on grandfathered plan status are discussed in our June 21, 2010 LawFlash, “Interim Final Rules Released on Group Health Plan Grandfather Status Under Healthcare Reform Law,” If grandfathered plan status is lost, significant plan changes may be required to comply with non-grandfathered plan healthcare reform provisions.