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Annual Limit Waivers

The Affordable Care Act bans annual dollar limits beginning in 2014.  Until then, annual limits are limited under HHS regulations published in June 2010.  For plan years starting between September 23, 2010 and September 22, 2011, plans may not limit annual coverage of essential benefits such as hospital, physician and pharmacy benefits to less than $750,000.  The restricted annual limit will be $1.25 million for plan years starting on or after September 23, 2011, and $2 million for plan years starting between September 23, 2012 and January 1, 2014. For plans issued or renewed beginning January 1, 2014, all annual dollar limits on coverage of essential health benefits will be prohibited. 

A class of group health plans and health insurance coverage, generally known as “limited benefit” plans or “mini med” plans, often has annual limits well below the restricted annual limits set out in the interim final regulations. Because this is often the only type of private insurance available to some workers, the Department of Health and Human Services (HHS) has issued temporary waivers to allow workers to keep their insurance. These “annual dollar limit” waivers only last for one year and are only available if the plan certifies that waiver is necessary to prevent either a significant increase in premiums or decrease in access to coverage.  Additionally, health plans that receive waivers must tell consumers if their health care coverage is subject to an annual dollar limit lower than what is required under the law. 

This page contains guidance related to the annual limit waiver process, including the waiver application form and instructions.