Employees enrolled in limited-benefit medical plans may be blocked from participating in the federal high-risk pool created by the PPACA.
An employee enrolled in a limited-benefit medical plan that has been granted a "waiver" may not be eligible to participate in the Pre-existing Condition Insurance Program (PCIP), commonly called the federal high-risk pool, if they develop a serious medical condition.
Waivered limited medical plans are generally considered group health plans and are therefore creditable coverage. An employee who develops a serious medical condition will be blocked from participating in the high-risk pool if they've been enrolled in a plan providing creditable coverage in the last six months.
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However, limited benefit plans that are indemnity-based excepted benefits, are not defined as creditable coverage, and therefore an employee enrolled in such a plan will not need to include it when completing the prior health coverage section of the federal application for PCIP coverage.
Some companies, such as Ternian Insurance Group, are helping employers make sure their employees can take advantage of the federal high-risk pool in the event of a serious medical condition by offering plans that are indemnity-based excepted benefits. Ternian will replace an employer's expense-incurred limited-benefit medical plan with a Ternian plan and issue a policy for the remainder of this plan year as well as the next at a guaranteed rate.
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