Will Awareness Kill Contempt?

The Department of Health and Human Services (HHS) recently announced that nearly $200million in new grant funds are now available to help states develop programs that will make health insurance premiums more transparent and provide "the power to stop unreasonable premium increases from taking effect."

This new funding is in addition to the $46 million awarded in August of 2010 to 45 states and the District of Columbia to control premium hikes. It also complements new rules proposed in December of 2010 to require insurance companies to publicly justify unreasonable premium rate increases.

The new funding will help states with their premium rate review programs to ensure that proposed health insurance rate hikes are comprehensively reviewed and to provide greater transparency and openness to the rating process.

The HHS would determine that a state has an effective rate review program, if the state does the following:

 collects enough information from insurance companies to determine whether rate increases are unreasonable;
 dedicates enough resources to effectively review that information in a timely manner;
 analyzes the reasons insurance companies give for raising rates based on whether they are valid and reasonable; and
 has a legal definition for a reasonable or unreasonable rate increase.

This national effort is part of the Affordable Care Act, otherwise known as “health reform”, but how many Americans are aware of this new protection from unreasonable health insurance premiums?

For a comprehensive analysis of the Patient Protection and Affordable Care Act, including the full text of the law and additional information on health reform implementation and other recent developments in employee benefits, just click here.

Health reform is still the law of the land, though many don’t realize it

A quick quiz. Is last year’s federal health reform legislation, the Patient Protection and Affordable Care Act (PPACA) still valid law? You’d think that most people would know the correct answer, yes, it’s still the law of the land.

According to a recent survey, “most people” do know it’s still good law, but only just barely. In fact, only 52 percent of respondents to a Kaiser Family Foundation (KFF) poll correctly knew that the PPACA is still in effect. An astounding (to me, anyway), 22 percent incorrectly believed that PPACA has been repealed and is no longer law.

Why would they think it’s been repealed? Certainly there’s been a lot of media attention on the recent vote by the House of Representatives to repeal the law. Perhaps people are forgetting what they learned in civics class. As one commentator suggested, maybe it’s time to bring back Schoolhouse Rock and let “I’m Just a Bill on Capitol Hill” help clarify the whole legislative process for a new generation. Of course, as was probably explained on one of those Saturday mornings long ago, a repeal wouldn’t take effect unless both the U.S. House and the U.S. Senate, now controlled by the Democrats, also passed repeal legislation and then President Barack Obama signed it.

Do those people who believe that the health reform has been repealed rely on the fact that two federal district courts have declared the individual mandate unconstitutional? (Interestingly, as of now, three federal district courts have ruled that the PPACA’s individual mandate is constitutional but we don’t hear as much about the courts that have upheld it.) Clearly, we have a long way to go until the legality of health reform legislation is settled in the courts.

Or do the respondents who think the law has been repealed just not know? We’ll never know what they were thinking when they answered but I wish the survey had followed up, asking them why they thought that health reform had been repealed. Perhaps someone else will ask this question in another survey.

Additional survey results. The KFF survey had some additional information. For instance, nearly one in three Republican survey respondents thought the health reform law had been repealed. One in four independents and one in eight Democrats thought the same. People with higher incomes as well as those with college degrees were more likely to have an accurate view of the status of the law.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, including the full text of the law and additional information on health reform implementation and other recent developments in employee benefits, just click here.

Insurers' responses to health reform law emerging

How will health insurers respond to the passage of health reform, last year’s Patient Protection and Affordable Care Act (PPACA)? Earlier, we received some insights into how employers will respond to this legislation. A survey from benefits consultant Milliman has now clarified how insurers are expected to respond.

Employers Take Advantage Of The Health Reform Law They Want Repealed

Although six in 10 employers hope health reform will be repealed, a recent survey reveals that seven in ten believe some parts of health care reform should stay in place and almost six in ten believe reform was long overdue. And at least one ACA program has proven very popular with corporate America.

The Department of Health & Human Services (HHS) expects to pay out about $3.6 billion in reimbursements for medical expenses for the Early Retiree Reimbursement Program in fiscal year 2011, which began on Oct. 1, 2010 and ends on Sept. 30, 2011.

According to the agency's budget for fiscal year 2012, as of Jan. 25, 2010, more than 5,000 early retiree medical plan sponsors had been approved for participation and about $1 billion had been paid. All Fortune 500 employers have applied for the program.

The remaining $1.4 billion balance of the $5 billion allocated for the program by the Patient Protection and Affordable Care Act (ACA) is expected to be exhausted in fiscal year 2012. Since late January, almost 300 additional firms have begun participation in the ERRP. A state-by-state listing is available here.

The ACA established the ERRP as a temporary measure to reimburse part of the claims costs for participating employment-based plans that provide health insurance coverage for early retirees ages 55 through 64, and their eligible spouses, surviving spouses, and dependents. The ERRP will reimburse for 80% of a plan's individual claims that are between $15,000 and $90,000, indexed for inflation. The program is effective June 1, 2010, and ends on the earlier of Jan. 1, 2014, or when the $5 billion appropriated for the program is exhausted.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, including the full text of the law and additional information on health reform implementation and other recent developments in employee benefits, just click here.

Angel Or Devil? Budget Process Highlights Health Reform Divide

The health reform battle has a new venue beginning this week—the debates over the 2012 budget and Congressional continuing resolutions to keep the government running while the budget debate continues. And if you think the Democrats and Republicans are fighting the battle in two different universes, you are right.

Here is President Barack Obama’s 2012 budget statement on the Patient Protection and Affordable Care Act (ACA):

States Struggle With Health Reform Implementation

A recent letter from 21 state governors to Health and Human Services (HHS) Secretary Kathleen Sebelius has asked for six specific changes to give states more control over insurance exchanges established under the Patient Protection and Affordable Care Act (ACA).

The letter recognizes that neither the courts nor Congress may ultimately repeal health reform, and thus the governors “face the decision of whether to participate in the bill by operating state exchanges, or to let the federal government take on that task, if the bill remains in effect in 2014.”

Health reform rollercoaster on fast track to Supreme Court?

Do you ever feel you’re on a rollercoaster ride when following health care reform developments? The ups, the downs, the twists and turns. Well, hold onto your hats folks, because your trip might be speeding toward the Supreme Court.

Virginia Attorney General Ken Cuccinelli has filed a petition asking the United States Supreme Court to take Virginia’s health care lawsuit now, as opposed to waiting for the case to first be decided by the court of appeals. The Petition for Certiorari Before Judgment in the United States Supreme Court in the case of Commonwealth v. Sebelius was filed pursuant to Rule 11 of the Rules of the United States Supreme Court, according to a press release from the Virginia AG’s office.

Mississippi throws out health reform challenge on jurisdictional grounds

A federal court in Mississippi has joined more than a dozen other districts in ruling that those seeking to overturn the Patient Protection and Affordable Care Act (ACA) do not have standing to file suit (a listing of many of these cases is available at http://m.whitehouse.gov/blog/2010/12/08/health-reform-wins-another-round-court). In four other cases, judges have ruled on the merits of the challenges to the ACA.

In Lt. Gov. Phil Bryant vs. Eric Holder Jr. (Civ. Act No. 2:10-CV-76-KS-MTP), the U.S. District Court for the Southern District of Mississippi stated that the lawsuit "contains insufficient allegations to establish that [the plaintiffs] will certainly be 'applicable individuals' who must comply with the minimum coverage provision [of the ACA]."

Let's ditch the paperwork, Senate says

The Senate has approved by a 81-to-17 margin an amendment to the FAA reauthorization bill (S. 223) currently under debate in the Senate that would repeal new IRS Form 1099 reporting requirements for businesses. The measure, offered by Sen. Debbie Stabenow, D-Mich., is offset by rescinding $44 billion in previously approved but unobligated discretionary spending; however, unobligated funds of the Defense and Veterans Affairs Departments and the Social Security Administration would not be affected.

The requirement was signed into law as part of the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148) and has been widely decried by small businesses as an unnecessary paperwork burden. The provision mandated that all businesses file a return for payments to vendors in excess of $600 beginning in 2012 and was estimated to raise some $19 billion over 10 years to help offset the cost of health care reform.

The repeal has widespread bipartisan support and White House backing, but previous attempts to repeal the bill have failed as lawmakers could not reach agreement on how to offset the legislation. Ironically, Democrats in November 2010 defeated, by a 61-to-35 margin, a repeal measure offered by Sen. Mike Johanns, R-Neb., that also called for offsetting the cost with unused federal funds. A repeal bill with no offsets was offered at the same time by Senate Finance Committee Chairman Max Baucus, D-Mont. and fell by a 44-to-53 margin.

Stabenow estimated that, if Congress failed to repeal the requirement, Form 1099 filings for businesses would increase an estimated 2,000 percent. "If left unchecked, this 1099 provision would tie up 40-million small businesses in red tape and burdensome IRS reporting requirements, so we need to fix it now," said Stabenow. "This amendment is a common-sense solution for business owners who need to be focused on creating jobs, not filling out paperwork for the IRS." 

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Report: some employers will pass health reform costs to employees

More than 40% of employers said that they are likely, and another 23% said that they are "highly" likely, to pass along any direct or indirect health reform-related cost increases to employees, according to research from the Employee Benefit Research Institute (EBRI) and the Society for Human Resource Management (SHRM). The 2010 EBRI/MGA Consumer Engagement in Health Care and the 2010 SHRM Organizations' Response to Health Care Reform surveys found that few are unlikely (10%) or "highly" unlikely (2%) to pass along cost increases related to the Patient Protection and Affordable Care Act (ACA), while 23% were unsure whether cost increases would be passed along to workers.

The studies noted that while the majority of employers are likely to pass along cost increases onto workers, only 30% of employers said that they were likely to pass along any cost decreases that were directly or indirectly related to the ACA. And, while 23% were "highly" likely to pass along these cost increases, only 10% were "highly" likely to pass along similar cost decreases.

Low knowledge of health reform. The Obama Administration may be frustrated with the level of current understanding of the reform law. Only 2% of adults with private insurance reported that they were "extremely" knowledgeable about the ACA, and only 7% reported that they were "very" knowledgeable. Most reported that they were "somewhat" knowledgeable (35%) or "not very" knowledgeable (37%). In addition, 18% said that they were "not at all" knowledgeable about the health reform law. Less than half of employers (45%) said that they were comfortable with the ACA, while 41% said they were not comfortable with the ACA, and 11% were strongly uncomfortable with the provisions of the ACA.

Future of employer-provided coverage. Despite their self-confessed lack of knowledge about reform, however, most Americans who currently have employer-provided coverage believe they will get to keep it.

Florida judge: stop ACA rollout

In issuing a declaratory judgment on January 31 that the entire Patient Protection and Affordable Care Act (ACA) is unconstitutional, Judge Roger Vinson of the U. S. District Court for the Northern District of Florida may have, in effect, voided the implementation of the law in the 26 states that joined in the Florida case.

In the ruling, Mr. Vinson stated both that the individual mandate in the ACA is unconstitutional and that the individual mandate cannot be separated from the rest of the law (State Of Florida, et al. v. United States Department Of Health And Human Services, et al. (Case No.: 3:10-Cv-91):

"There are simply too many moving parts in the Act and too many provisions dependent (directly and indirectly) on the individual mandate and other health insurance provisions-which, as noted, were the chief engines that drove the entire legislative effort-for me to try and dissect out the proper from the improper, and the able-to-stand-alone from the unable-to-stand-alone."

Mr. Vinson then concluded, "Because the individual mandate is unconstitutional and not severable, the entire Act must be declared void. This has been a difficult decision to reach, and I am aware that it will have indeterminable implications. At a time when there is virtually unanimous agreement that health care reform is needed in this country, it is hard to invalidate and strike down a statute titled 'The Patient Protection and Affordable Care Act.'"

So, what does this mean?