The Power of A

The Obama Administration today announced its next set of regulations to provide further detail for the new health care law as well as highlight some of the benefits already in place.  Today, the president and administration officials are meeting with the CEOs of some of the nation’s largest insurance companies, and are expected to outline new requirements for insurance companies in their plan offerings.

The new regulations are timed to counteract a series of negative health care stories.  A report released Monday by the Kaiser Family Foundation found that self-insured individuals saw an increase of 20% on average for their insurance plans last year, and because some of the self-insured reforms from the health care bill will not go into effect until 2014, the rates could continue to rise for these plans.  Additionally, there is concern that as states struggle with their budget situations and the unemployment rates remain steady, a large number of Americans could face a coverage gap that reform would begin to fix but not until 2014.

To help settle these concerns, the Obama administration has released its “patients’ bill of rights“.  These principals and regulations would dictate the coverage market for reforms that would be in place between now and 2014, when a larger number of reforms come into play.  The White House released its list of upcoming regulations and clarifications today, which include:

- A ban on lifetime coverage limitations, as well as a phasing out of current annual coverage limits.  Beginning this year, the lower cap is set at $750,000 and rise to $2 million in 2012 before being completely phased out in 2014.

- A prohibition on insurers canceling insurance of people who become ill unless there is intentional deception on an insurance application.

- A loosening of the primary care physician requirements and fewer requirements for prior approval for seeing a specialist.  For example, women can now list their ob-gyn as a primary care physician.

In addition, the Department of Health and Human Services will launch its insurance portal HealthCare.gov next week.  The site will allow consumers to compare information on different insurance companies and their plans, as well as receive information on what kinds of plans they are eligible to join.  The site will possibly add price estimates to the plans, based on a users geographic area, by October.

Bloomberg News is reporting this morning that House Energy & Commerce Chair Henry Waxman (D-CA) sent letters to six insurance companies demanding information on their small business plans and specifically a response to allegations that the insurers routinely drop small businesses when their premiums increase due to employee illness.

The letters, which were sent to insurers including WellPoint and Aetna (seen here), demanded that the insurers produce relevant documents explaining their small business plans, policies to determine when to raise rates as well as drop coverage, and the maximum rate increase.  Congressman Bart Stupak (D-MI), a co-signer on the letter and chair of the committee’s oversight subcommittee, has promised hearings into the alleged purges of small businesses.

“As part of our ongoing investigation, we are now looking into the practice of health insurance companies terminating the coverage of small businesses when their employees become ill and their health insurance claims increase,” said Waxman in a statement. “We need to better understand how widespread this harmful and destructive practice has become, and how it is impacting small businesses and their employees across the country.”

A spokesperson for America’s Health Insurance Plans (AHIP), which represents the major insurance companies, called the letters a “fishing expedition.”  “This is just a continuation of a politically timed and politically motivated fishing expedition in an attempt to justify a new government-run plan,” said Robert Zirkelbach, a spokesman for AHIP. “Health plans are already highly regulated at both the federal and the state level, and the overwhelming majority of Americans are satisfied with their current health care coverage.”

Quick Hits

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