NU Online News Service, June 14, 4:05 p.m. EDT

Employers will lose the right to retain their current health care plans if they increase deductibles or co-pays by more than the rate of medical inflation plus 15 percent under regulations unveiled by the Obama administration Monday.

Employers will also be unable to increase cost sharing by more than 5 percent.

According to an analysis by an industry trade group, that would mean a plan could not be grandfathered--or retained by employers--if it, for example, changes a co-pay from $30 to $45, a 50 percent increase, and the rate of medical inflation is 8 percent.

The rule proposed by the administration is an interim regulation with a request for comment.

The regulation projects that compliance will not cause major changes for the 133 million Americans with employer-sponsored health insurance through large employers (100 or more workers).

But a fact sheet that accompanies the rule projects that the roughly 43 million people insured through small businesses will likely transition from their current plan to one with the new protections over the next few years.

Moreover, the 17 million people who are covered in the individual health insurance market--where switching plans and substantial changes in coverage are common--"will receive the new protections of the Affordable Care Act sooner rather than later," the fact sheet states.

The administration issued the rule as required by the new Affordable Healthcare Act.

It allows employers to retain current health care plans only if they comply with the restrictions specified under the new regulation.

Under the interim rule, the administration projects that more than half the health care plans now in existence won't be in compliance with the new rules by 2013.

Special Reports /

Changes To Employer Health Plans Restricted By Proposed Reg

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