State RegulationsFL specificDifficulty 1/5
What must the sponsor of a grandfathered group health plan do in order to claim and preserve the plan's grandfathered status?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
To claim grandfathered status, a plan sponsor must keep records sufficient to verify, explain, and clarify the plan's status and must include a statement in plan materials distributed to participants that the plan believes it is a grandfathered plan. These disclosure and recordkeeping requirements work alongside the minimum benefit standards reflected in Chapter 627, Florida Statutes, and help the Florida Office of Insurance Regulation and enrollees confirm which standards actually apply to the plan. No annual affidavit or agency pre-approval of grandfathered status is required under Florida law.
Why the other options are wrong
- A) No annual sworn affidavit with the Office of Insurance Regulation is required; the sponsor's own records and disclosures establish the status.
- C) The Department of Financial Services does not approve grandfathered status each plan year; that is not a condition of maintaining the plan's status.
- D) Reducing employee benefits each year would itself forfeit grandfathered status rather than preserve it.
Memory hook
Records plus disclosure = the grandfather's paperwork.