What are the annual and lifetime limits on essential health benefits under the Affordable Care Act (ACA)?
Author: Alison D. Hurt, LeClairRyan
There are no annual or lifetime limits on essential health benefits under the ACA. For plan years beginning on or after September 23, 2010, lifetime limits on the dollar value of essential health benefits are prohibited for all plans, both new and grandfathered. There is a three-year phased in approach for the annual dollar limit restrictions. The permissible limitation for plan years beginning on or after:
- September 23, 2010 is $750,000;
- September 23, 2011 is $1.25 million; and
- September 23, 2012 (and before December 31, 2013) is $2 million.
With the exception of grandfathered individual plans, annual limits for essential health benefits are completely eliminated for plan years beginning on or after January 1, 2014.
Plans may apply per-beneficiary annual and lifetime limits on any nonessential health benefits. Additionally, the law does not prevent a plan from excluding all benefits for a particular condition.