On Tuesday, the Obama administration proposed three rules outlining how provisions under the Affordable Care Act would work, the Washington Post reports.
The three rules — one that prohibits insurers from discriminating against individuals with pre-existing conditions, another that establishes essential health benefits, and a third that expands employer-based wellness programs — are not yet final and will be open for comment until Dec. 26 (Aizenman, Washington Post, 11/20).
Proposed Rule To Prohibit Insurers From Discriminating Against Certain Patients
HHS proposed a rule implementing an ACA provision that prevents insurers from discriminating against individuals with pre-existing or chronic conditions.
The rule would prevent insurers from denying coverage to patients with pre-existing or chronic conditions. It also would prevent insurers from charging higher premiums to certain beneficiaries because of current or past insurance programs, gender, occupation and industry or employer size.
However, the rule would allow insurance companies to vary premiums — within limits — based on age, tobacco use, family size and geography (HHS release, 11/20). For example, insurers would be able to charge elderly individuals up to three times more than younger customers (Baker, “Healthwatch,” The Hill, 11/20).
According to HHS, the rule targets 50 million to 129 million U.S. residents who have conditions that insurance companies have cited in coverage denials or insurance cost increases (Wayne, Bloomberg, 11/20).
The rule also requires states to establish a single statewide risk pool for individual and small employer markets, unless a state opts to combine the two pools. Premiums and yearly rates would be based on the entire pool. In addition, the rule calls for a catastrophic plan in the individual market for young adults and individuals who cannot find affordable coverage (Zigmond, Modern Healthcare, 11/20).
Proposed Rule To Establish Essential Health Benefits
A second proposed rule delineates an ACA provision that creates essential health benefits for plans in the individual and small group markets, National Journal reports (Sanger-Katz, National Journal, 11/20).
Specifically, the rule ties essential benefits to a state’s benchmark plan, including the state’s largest small group plan, and must include items and services in at least the following 10 categories:
- Ambulatory patient services;
- Emergency services;
- Laboratory services;
- Maternity and newborn care;
- Mental health and substance use disorder services;
- Pediatric services;
- Prescription drugs;
- Preventive and wellness services and chronic disease managements; and
- Rehabilitative services and devices (Fox, NBC News, 11/20).
Most states are using the benefits provided by the largest health plan in the state’s small-group insurance market as a benchmark. However, the rule requires insurers to provide additional benefits, including dental care and vision services for children, mental health and drug misuse treatment, and “habilitative services” for individuals with conditions such as autism or cerebral palsy.
HHS’ proposed rule goes beyond the informal guidelines issued last year by expanding comprehensive prescription drug coverage to include at least two drugs in each therapeutic class (Pear, New York Times, 11/20).
The proposed rule also addresses the actuarial value component of the essential health benefits, which is the percentage of the total average costs for benefits that a plan covers.
In 2014, a “bronze” plan must cover 60% of all covered benefits, a “silver” plan must cover 70%, a “gold” plan must cover 80% and a “platinum” plan must cover 90%.
The rule would allow plans to be within two percentage points of the standard. For example, a silver plan could cover 68% of the benefits (Modern Healthcare, 11/20).
Proposed Rule To Establish, Expand Wellness Programs
HHS, the Department of Labor and the Treasury Department proposed a rule that would establish and expand workplace wellness programs that promote health and control health spending, Modern Healthcare reports (Modern Healthcare, 11/20).
The rule allows employers to award employees as much as 30% of their health coverage costs for participating in wellness programs, an increase from the current 20%. Meanwhile, workers that enroll in smoking cessation programs could earn back as much as 50% of their coverage costs, HHS said.
The rule also requires employer-based wellness programs to provide alternative ways to qualify for rewards for individuals with special medical conditions (Viebeck, “Healthwatch,” The Hill, 11/20).
Insurers, Executives React To Rules
Meanwhile, Karen Ignagni, president and CEO of America’s Health Insurance Plans, in a statement on Tuesday said the “additional flexibility” on deductible limits is a “positive step.” However, she added, “[W]e remain concerned that many families and small businesses will be required to purchase coverage that is more costly than they have today” (Washington Post, 11/20).
Although insurance executives likely will not be satisfied with every decision HHS makes, Caroline Pearson, director at Avalere Health, said that “clear guidance and certainty is better than anything else” (Sanger-Katz, National Journal, 11/20).
In regard to the proposed increased access to prescription drugs, Stephen Finan, a health economist at the American Cancer Society, said the rule is an “improvement” from last year but “still does not guarantee that cancer patients will have access to all the major cancer drugs they need” (New York Times, 11/20).
Details About Federal Health Insurance Exchange Still Unknown
Meanwhile, states still are waiting for details about how federally run insurance exchanges will operate, CQ HealthBeat reports. During a press call about the rules on Tuesday, Gary Cohen, a senior official at CMS, said the agency “will be putting out additional guidance on the federally facilitated exchange in the near future.”
Cohen noted that in a federally run exchange, decisions about cost and coverage options will be determined by the government, not the state. He added that consumers “will have the same access to quality affordable care whether the state is running the exchange or whether the federal government is running the exchange” (Reichard, CQ HealthBeat, 11/20).