Grand Mothering SB 1446

Non Grandfathered Plans can go one more year

This page is Historical

Grand Mothering SB 1446 means that Small Employer Health Insurance policies that were in force on December 31, 2013, and still in force when SB 1446, which passed on July 7, 2014, that are not grandfathered under Health Care Reform can be renewed for one more year until the end of 2015. CA Healthline 7.8.2014HealthCare.GovFederal Regulation 3.5.2014

70% of Small Businesses can expect a rate increase when Grand Mothering runs out 12.1.2015. CA Healthline 4.13.2015 At a recent seminar on 5.5.2015 we were told the new rates would be anywhere from -42% to +192%!  I didn’t believe it, but check out this renewal from Health Net.  Learn more about rating and premium calculation under Health Care Reform vs AB 1672 (1992).

San Diego Tribune 11.11.2015 on the hassles of Grandmothering

Grand Fathering means plans that were in force on 9.23.2010 and haven’t changed… can stay remain in force as President Obama promised. They do not have to fully comply with the 10 essential benefits and certain other requirements under Health Care Reform.

Blue Shield “Generic” notification for 10.2015 – 12.2015 Renewals – WITHDRAWAL of Grand Mothered Plans – Must all be ACA compliant.  Wholesalers Mapping Summary for Most All Companies Excel Spreadsheet  ♦   Health Net Pre-Announcement of 2016 Plans 7.2015

Don’t forget though, that all plans are mandated to pay out 80% in actual medical costs, so IMHO it might be 6 of one, 1/2 dozen of the other.

Insurance Company Explanations

Blue Shield – Loss of Grand Mothered Status – Mapping 7.2015

comparisons (Grand Fathered, Grand Mothered and ACA compliant) , Email us to get this form

exemptions and Insurance Company bulletins.

Comparison Chart – Grand Mother – Grand Father – ACA Compliant Plans
(10 Essential Benefits)
Word & Brown Summary Comparison

Rating Comparison   – Our site on Rating

EXACT full details for each Insurance Company click here then click on the Administrative Page

Forbes on the Pros & Cons

Call 310.519.1335 or email us [email protected] for further information & questions.

Blue Shield Employer Client Letter
Health Net Transitional Plan Offer Letter ♦ (more
Form to Keep AB 1672 Plan ♦ FAQ
Aetna won’t be doing Grand Mothering (per rep’s visit to my office)
Blue Cross FAQ’s
See Change is leaving the CA Market Place
Email us [email protected] for comparative underwriting and rules chart.


SB 1446, as amended, DeSaulnier. Health care coverage: small employer market. Click here for the actual code of SB 1446,
Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms that take effect with respect to plan years on or after January 1, 2014. Among other things, PPACA requires each health insurance issuer that offers health insurance coverage in the individual or group market in a state to accept every employer and individual in the state that applies for that coverage and to renew that coverage at the option of the plan sponsor or the individual. PPACA prohibits a group health plan and a health insurance issuer offering group or individual health insurance coverage from imposing any preexisting condition exclusion with respect to that plan or coverage. PPACA allows the premium rate charged by a health insurance issuer offering small group or individual coverage to vary only by rating area, age, tobacco use, and whether the coverage is for an individual or family and prohibits discrimination against individuals based on health status. PPACA requires a health insurance issuer that offers coverage in the small group or individual market to ensure that the coverage includes the essential health benefits package, as defined. However, guidance issued under PPACA grants transitional relief to health insurance coverage in the individual or small group market for policies in effect on October 1, 2013, that are renewed for a policy year starting between January 1, 2014, and October 1, 2016, and exempts that coverage from certain PPACA reforms, as specified.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975 (Knox-Keene Act), provides for the licensure and regulation of health care service plans by the Department of Managed Health Care. Existing law also provides for the regulation of health insurers by the Department of Insurance. Existing law implements the PPACA reforms described above under the Knox-Keene Act and the laws governing health insurance.

This bill would allow a small employer health care service plan contract or a small employer health insurance policy that was in effect on October 1, December 31, 2013, that is still in effect as of the effective date of this act, and that does not qualify as a grandfathered health plan under PPACA, to be renewed until January 1, 2015, and to continue to be in force until December 31, 2015. The bill would exempt those health care service plan contracts and health insurance policies from various provisions of state law that implement the PPACA reforms described above and would require that the contracts and policies be amended to comply with those provisions by January 1, 2016, in order to remain in force on and after that date. The bill would require that these provisions be implemented only to the extent permitted by PPACA.
This bill would declare that it is to take effect immediately as an urgency statute.
Health Plan ACA Provision Exemptions Under SB 1446
“Grandmothered” health plan contracts and insurance policies that are renewed under SB 1446 are exempt from the following health reform provisions:

  • Guarantee issue
  • Prohibitions against rejecting applications
  • Requirements for a single risk pool
  • Rating limitations associated with age (maximum 3:1 ratio for youngest to oldest adults), family size (member level rating for those 21+), and geographic regions (19 in California)
  • Requirements to provide essential health benefits (EHBs)
  • Limitations on out-of-pocket expenses and deductibles
  • Coverage categorized by metal tiers and actuarial value: Platinum (90%), Gold (80%), Silver (70%), and Bronze (60%)
  • Small employer health plan contracts and insurance policies renewed under SB 1446 must be amended by 1/1/2016 to comply with the ACA reform provisions listed above.
  • These “grandmothered” plans must comply with the following health reform provisions:
  • Preventative care without co-pays or deductibles
  • No lifetime caps on benefits
  • Maternity care
  • Coverage for autism
  • Elimination of gender discrimination in setting premiums
  • California 60-day waiting period maximum (AB 1083)
  • With regard to rating, these “grandmothered” plans will:
  • Get a Risk Adjustment Factor (RAF) between .90 and 1.10
  • Have the pre-ACA maximum 9 rating areas
  • Use the pre-ACA age bands (Under 30, 30–39, 40–49, 50–54, 55–59, 60–64, and 65+) (Word & Brown Grandfathering Rules on this website)

Broker ONLY

Kaiser Permanente “Grandmothering” Broker Letter

Health Net October 2015 Renewal 67% increase!
Health Net October 2015 Renewal 67% increase!
Click to view full text of SB 1446 Grand Mothering
SB 1446 Full Text