Benefitfocus Healthcare Reform Journal

Healthcare Reform Update - 15June2010

2010-06-16T05:50:00.000-07:00

Health Reform’s Medical Loss Ratios Threaten Individual Insurance Market

State insurance officials just announced that they fear health insurance companies will cancel policies and leave the individual insurance market in some states because of a provision in the new healthcare reform law.
The provision in the law, effective Jan. 1, 2011, requires most insurers to spend a larger share of their premium revenue — at least 80 percent for the individual market — on medical care and quality-improvement services, rather than administrative expenses and profits.

Insurers must refund money to their individual consumers if they do not meet the medical-loss ratios.

The National Association of Insurance Commissioners (NAIC) is recommending that the federal government allow a gradual three-year transition for this requirement.

Their proposed draft states that federal officials should lower the threshold on a state-by-state basis if immediate enforcement of the requirement would destabilize the individual insurance market.

State officials, which comprise the NAIC, expect to submit their recommendations to HHS sometime during July 2010.

The law gives the NAIC a special role to advise the Secretary of HHS about defining and calculating medical-loss ratios.
The law also says the HHS Secretary can adjust the medical-loss ratio in a state if she finds that enforcement of the full 80 percent requirement would “destabilize the individual market” there.

The NAIC does not list specific states that may need the requirement adjusted, but they would likely include less-populous states with relatively few insurers. However, even California officials have said they are worried about the provision, as they think insurers will be compelled to drop out of the individual market under this provision of the federal law.
Millions of people get insurance from companies that do not currently meet the medical-loss target.
If an insurer does decide to exit the individual market in a state, it must give 180 days’ notice to policyholders.
Read more: http://www.nytimes.com/2010/06/15/health/policy/15health.html?emc=tnt&tntemail0=y

Healthcare Reform Update – 14June2010

2010-06-15T06:04:00.001-07:00

Regulation Issued on Grandfathered Health Plans Under Healthcare Reform Law

The Department of Health and Human Services today announced new regulations surrounding the “grandfather rule” included in the healthcare reform law.
Under healthcare reform, all health plans must provide new benefits to consumers; however, plans that existed on March 23, 2010 are “grandfathered,” meaning they are exempt from some new requirements.
Up until this point, it has been unclear what changes a plan can make without losing its grandfather status. The regulations detailed today clarify some of these points.
According to the regulations, health plans can make routine changes without losing their grandfather status. This includes cost adjustments to keep pace with medical inflation, adding new benefits, making small adjustments to existing benefits, voluntarily adopting new consumer protections under the new law, or making changes to comply with state/other federal laws.
Premium changes are not taken into account when determining whether or not a plan is grandfathered.
Health plans will forfeit their grandfather status if they significantly cut benefits or increase out-of-pocket spending for consumers; consumers in plans that make such changes will also gain new consumer protections (e.g., coverage of recommended prevention services with no cost sharing, access to OB-GYNs and pediatricians without a referral by a separate primary care provider, etc.)
Read more: http://www.healthreform.gov/newsroom/keeping_the_health_plan_you_have.html.
Read the regulation: http://www.federalregister.gov/OFRUpload/OFRData/2010-14488_PI.pdf.

Healthcare Reform Update – 10June2010

2010-06-10T08:33:00.001-07:00

This update includes the following:

New York Enacts Landmark Rate Review Law
HHS Announces $51 Million in Grants to Enhance Health Insurance Premium Rate Review
HHS Clashes with Medicare Insurers on Rates
White House Launches Campaign to Build Up Health Law
Republicans put health reform on primary ballot in push to turn out conservatives

New York Enacts Landmark Rate Review Law

On Wednesday the Governor of New York signed legislation granting the state authority to review and approve health insurance premiums before they take effect, and increasing medical loss ratio percentages, with which insurers in the state must comply.
The new law, which covers about three million people enrolled in small-employer or individually purchased plans, requires insurance companies to apply to the state Insurance Department before they can raise premiums. The state then has 60 days to determine whether the rates are justified.
In early May, Health and Human Services Secretary Kathleen Sebelius sent a letter to governors and state insurance commissioners urging them to review the authority they have under their state laws to determine whether they have all of the regulatory tools needed to approve health insurance rates before they take effect.
Several provisions in the healthcare reform law strengthen government oversight of insurance premiums and rate hikes, including grants for states to help create or strengthen reporting and review processes.
Read more: http://www.nytimes.com/2010/06/10/nyregion/10insurance.html

HHS Announces $51 Million in Grants to Enhance Health Insurance Premium Rate Review

Health and Human Services Secretary Kathleen Sebelius announced the availability of $51 million in Health Insurance Premium Review Grants funded by the new healthcare reform law.
This is the first round of grants available to states through a new $250 million grant program to create and strengthen insurance rate review processes.
All 50 states and the District of Columbia are eligible for the grants. To receive a grant, a state must submit a plan for how it will use the funds to develop or enhance its process of reviewing and approving, disapproving, or modifying health insurance premium requests. States with successful applications will receive a $1 million grant during the first round.
Several provisions in the healthcare reform law strengthen HHS’ and states’ oversight of insurance premiums and rate hikes. For example, the law requires that insurers in the individual and small group markets spend at least 80 percent of their premiums on healthcare, and insurers in the large group market spend at least 85 percent of their premiums on healthcare. The law also requires insurers to justify unreasonable premium increases to state regulators and the Secretary of Health and Human Services.
The grants that will be available in 2010 are only the first in a five-year grant program. HHS will take applications for a second round of state grants beginning in 2011, after new regulations regarding rate review take effect.
Read the press release: http://www.hhs.gov/news/press/2010pres/06/20100607a.html

HHS Clashes with Medicare Insurers on Rates

Insurance companies and the Obama administration are currently battling over how much seniors should pay for their privately-run Medicare plans next year.
In a letter to WellPoint Inc., Cigna Corp., BlueCross BlueShield Association and Health Care Service Corp., HHS Secretary Kathleen Sebelius warned the companies not to increase premiums and co-payments for seniors.
On Monday, insurers that sell Medicare Advantage plans had to submit their 2011 bids to the government.
Many insurers are planning to increase costs for a range of services for seniors next year. Dozens of Medicare Advantage providers plan to cut back vision, dental and prescription benefits. Some plans are eliminating free teeth cleanings and gym memberships, and raising fees for hearing aids, eye glasses and emergency-room visits.
According to the insurers, the cuts are necessary because the rate the government will pay private insurers to run the plans is frozen for 2011 at 2010 levels, while medical costs are expected to increase an average of at least 6 percent. The price increases and benefit reductions will help them recoup that difference.
Read more: http://online.wsj.com/article/SB10001424052748704726104575291121755620054.html?KEYWORDS=medicare

White House Launches Campaign to Build Up Health Law

President Obama and his allies are launching an elaborate campaign to sell the public on the healthcare reform law, including a new tax-exempt group that will spend millions of dollars on advertising to counter attacks on the measure and Democrats who voted for it.
The first evidence of the public relations offensive came Tuesday, when Obama traveled to Wheaton, Md. to conduct a nationally-televised question-and-answer session.
In Wheaton, Obama touted the distribution of $250 rebate checks for senior citizens who reached the “doughnut hole” in Medicare's drug coverage during 2010, one of the law's first benefits.
At the same time, he announced a new initiative to cut in half the amount of waste, fraud and abuse in the Medicare program by the end of 2012. This ambitious goal would require the federal government to recover as much as $18 billion.
Read more: http://www.latimes.com/news/nationworld/nation/la-na-obama-health-20100609,0,6844577.story

Republicans put health reform on primary ballots in push to turn out conservatives

South Carolina and Missouri added health reform questions to their primary ballots.
Arizona, Florida and Oklahoma will give voters a chance in November to amend their state constitutions to say residents of those states can’t be forced to pay a penalty if they don’t buy health insurance.
The amendment seeks to nullify the individual mandate, which consistently polls as one of the law’s most unpopular provisions.
Proponents of the law are launching a five-year, $125 million campaign to defend health reform.
Read more: http://thehill.com/homenews/campaign/101881-gop-puts-health-reform-on-ballot-as-turnout-tool

Other related articles that may be of interest:

According to a USA Today article, a growing number of US doctors are attempting to bring in extra profits by charging patients new fees for services they say insurance doesn't cover.

http://www.usatoday.com/news/health/2010-06-06-doctorsfees_N.htm

The New York Times ran an article highlighting dependent eligibility audits and the increasing number of employers using them to drop non-qualified dependents from the company plan.

http://www.nytimes.com/2010/06/05/health/05patient.html?scp=1&sq=employee&st=nyt

A CNN story discusses a rising trend in hiring – employers are beginning to add more temporary or contract-based positions, rather than traditional full-time jobs with benefits. With unemployment remaining close to 10 percent, employers have their pick of workers willing to accept less secure positions.

http://money.cnn.com/2010/06/01/news/economy/contract_jobs/index.htm

Healthcare Reform Update - 04June2010

2010-06-04T08:28:00.000-07:00

HHS Announces Availability of $60 Million in Healthcare Reform Grants

The U.S. Department of Health and Human Services (HHS) announced today the availability of $60 million in grants to states and communities to help seniors, disabled Americans and their caregivers better understand and navigate their health and long-term care options.
The purpose of this new grant program is to create streamlined, coordinated statewide systems of information, counseling and access that will help people find consumer-friendly answers to questions about their health and long-term care needs.
HHS’ Administration on Aging and the Centers for Medicare & Medicaid Services will work collaboratively to award the funds, which were authorized by the new healthcare reform law.
Some specific areas of focus will include assisting individuals who are under-served and hard to reach with information about their Medicare and Medicaid benefits, helping older adults and individuals with disabilities maintain their independent living status, assisting people transition from hospital or nursing home stays back into the community, and strengthening ties between the medical and social service systems.
Funds will be available to states, area agencies on aging, State Health Insurance Assistance Programs, and Aging and Disability Resource Centers.
The deadline for applications is July 30, 2010; grants will be awarded in September 2010.
For more information, visit http://www.aoa.gov/AoARoot/Grants/Funding/index.aspx.
Read more: http://www.hhs.gov/news/press/2010pres/06/20100603b.html

HHS Awards Additional Grants to Expand Use of Health Information Technology*

The Secretary of HHS today announced $83.9 million in grants to help networks of health centers adopt electronic health records (EHR) and other health information technology (HIT) systems.
The money was divided into 45 grants that will support new and enhanced EHR implementation projects, as well as HIT innovation projects.
Grantees will use the funds to improve healthcare quality, efficiency and patient safety.
The funds are part of the $2 billion allocated to HHS under the American Recovery and Reinvestment Act of 2009 to expand healthcare services to low-income and uninsured individuals through its health center program.
Read more: http://www.hhs.gov/news/press/2010pres/06/20100603a.html

*Note: There are two different types of exchanges: Health Information Exchanges and State-based Health Insurance Exchanges.

Health Information Exchanges are about communicating health information between providers and patients. The providers include doctors, hospitals, community health programs, federal programs and patients.
Regional and state-based Health Insurance Exchanges are designed to manage health plan shopping with payers, brokers and individuals.
Health Information Exchanges were included as part of the American Recovery and Reinvestment Act, also known as the the February 2009 “Stimulus bill”. The Act appropriated $20 billion for promoting the “meaningful use of health IT.” The Department of HHS was given most of the authority to decide how this money is spent.
In February 2010, HHS announced that over $750 million of this would be used for grant awards at the state and regional level to help healthcare providers adopt and use electronic health records. Part of this money went to 15 selected communities across the country to serve as pilots for eventual wide-scale use of health information technology.

HHS Announces Community Health Data Initiative

On Wednesday, HHS Secretary Kathleen Sebelius launched a national initiative to share a wealth of new community health data, intended to drive innovation and lead to the creation of new applications and tools to improve the health of Americans.
Through the Community Health Data Initiative (CHDI), increasing amounts of federally-generated community health data will be made publicly available in easily-accessible and useful formats.
The Initiative calls for Web application developers, mobile phone applications, social media and other cutting-edge information technologies to “put our public health data to work.”
The ultimate goal of the Initiative is to have an expanding array of applications built using HHS’ data, as well as data supplied by other sources.
The Initiative was announced at a Community Health Data Forum on June 2. At the meeting, developers and technology pioneers demonstrated 16 innovative applications that make use of publicly-available health data.
As part of the Initiative, by the end of 2010, a new HHS Health Indicators Warehouse will be deployed online, providing currently available and new HHS data on national, state, regional and county health performance in an easy-to-use “one stop data shop.”
The Warehouse will also include information on proven ways to improve performance on particular indicators, such as rates of smoking, obesity, diabetes, access to healthy food, utilization of healthcare services, etc.
Users will be able to explore all of this data on the Warehouse website, download it for free, and easily integrate it into their own websites and applications.
To learn more about the Community Health Data Initiative, visit www.hhs.gov/open.
Read the press release: http://www.hhs.gov/news/press/2010pres/06/20100602a.html

Other related articles that may be of interest:

The New York Times published an article that highlights the collaboration between the federal government and insurance companies as they implement the healthcare reform law: http://www.nytimes.com/2010/06/04/health/policy/04health.html?emc=tnt&tntemail0=y

The Washington Post’s Ezra Klein speculates what might happen if the Supreme Court rules the individual mandate unconstitutional: http://voices.washingtonpost.com/ezra-klein/2010/05/what_happens_if_the_supreme_co.html

BNET Healthcare recently posted an article highlighting the strain of healthcare reform on employers: http://industry.bnet.com/healthcare/10002843/healthcare-reform-companies-might-like-it-better-if-regulations-went-easier-on-employers/

Healthcare Reform Update - 18May2010

2010-05-19T07:43:00.000-07:00

Healthcare Reform Impacts Agents’ Commission

A recent Wall Street Journal article highlights one of the overlooked repercussions of the healthcare reform law.
Insurance salespeople will be among the first to feel the effects of the new law, as their commissions for selling policies to individuals and small groups are changing.
The law requires that insurers use at least 80 percent of their premiums (85 percent in some cases) to pay for medical care for members, rather than for administrative costs and profit-taking.
This will put pressure on insurance companies to reduce administrative waste and other overhead, including commission paid to insurance agents/brokers.
Currently, commissions typically run between 4-6 percent of a policy's premium, but can be as high as 30 percent for the first year.
Companies are already beginning to change how they pay these salespeople. For example, beginning May 1, Independence Blue Cross stopped paying small-group agents a percentage commission and switched to a monthly flat fee for each contract sold.
Read more: http://online.wsj.com/article/SB10001424052748703612804575222291352083452.html?KEYWORDS=health+overhaul

Healthcare Reform Update - 17May2010

2010-05-19T07:40:00.000-07:00

IRS Issues Guidance for Small Business Tax Credits http://www.irs.gov/newsroom/article/0,,id=223577,00.html

Today the IRS issued new guidance regarding the small business tax credits provided for by the federal healthcare reform law.
The small business tax credit is one of the first healthcare reform provisions to go into effect, and is designed to encourage small employers to offer health coverage for the first time or maintain coverage they already provide.
The credit takes effect this year and is worth up to 35 percent of a small business' premium costs. On Jan. 1, 2014, this rate increases to 50 percent (35 percent for tax-exempt employers).The credit phases out gradually for firms with average wages between $25,000 and $50,000, and for firms with the equivalent of between 10 and 25 full-time workers.
The announcement makes it easier for small businesses to determine whether they are eligible for the tax credit and how large a credit they will receive. A “qualifying employer” must:

Cover at least 50 percent of the cost of healthcare coverage for some of its workers based on the single rate
Have fewer than the equivalent of 25 full-time workers (e.g., an employer with fewer than 50 half-time workers may be eligible)
Pay average annual wages of less than $50,000
The guidance makes it clear that both taxable and tax-exempt firms qualify, and that small businesses receiving state healthcare tax credits may still qualify for the full federal tax credit. The guidance also allows small businesses to receive the credit for add-on dental and vision coverage in addition to regular health insurance.

Read the IRS press release:
Read the IRS’s three simple steps for determining if your business qualifies for the tax credit: http://www.irs.gov/pub/irs-utl/3_simple_steps.pdf

Healthcare Reform Update - 12May2010

2010-05-14T07:35:00.000-07:00

CBO Increases Cost Estimate for Healthcare Reform Law

• On Tuesday, the Congressional Budget Office (CBO) released its latest estimate of the total cost of the healthcare reform law.
• The CBO predicts the healthcare overhaul will cost about $115 billion more in discretionary spending over ten years than the original cost projections.
• If approved over the years by Congress, the additional spending would bring the total estimated cost of the overhaul to over $1 trillion.
• The CBO estimated in March that the gross cost of the overhaul would be $940 billion over 10 years, but cautioned that it couldn’t make an estimate of the discretionary costs without more time and information.
• In its latest projection, the CBO included provisions that were not factored in the previous estimate.
• The new numbers reflect the costs of funding programs in the law that are authorized but not paid for. For example, the Department of Health and Human Services is expected to need $5 billion to $10 billion to implement changes in Medicare, Medicaid, the Children’s Health Insurance Program and insurance industry reforms.
• The CBO also expects federal agencies to spend $10 billion to $20 billion over 10 years on administrative costs to implement the overhaul.
• Many Washington insiders expect the numbers to continue to rise, since the CBO noted this new estimate does not include 38 sections of grant programs, which cover 406-pages of legislation.
• Read more: http://www.modernhealthcare.com/apps/pbcs.dll/article?AID=/20100511/NEWS/305119975#

Obama Administration Files First Response to Healthcare Reform Lawsuit

• Late on Tuesday, the Justice Department defended the legality of the healthcare reform law in its first response to a number of court challenges.
• This first argument came in a lawsuit that the Thomas More Law Center, a conservative group, filed in federal court in Detroit the same day President Obama signed the first part of the healthcare reform law.
• The group based its lawsuit on a provision that requires most Americans to buy health insurance or face a fine. According to the Thomas More Law Center, this provision is beyond the scope of Congress' power and is an unconstitutional tax.
• The group also holds that the law violates their constitutional rights because federal tax dollars will be used to fund abortions.
• The Justice Department responded by arguing that Congress acted to address a national problem and that the lawsuit was premature because no one had been harmed by the law.
• The Justice Department also argued that Congress did not exceed its authority because individuals who do not want to buy insurance may qualify for an exemption from any penalty, and that U.S. law prohibits lawsuits that are aimed at blocking the collection of taxes.
• Read more: http://www.reuters.com/article/idUSTRE64B4Q720100512

Missouri Poised to Become First State to Vote on Healthcare Reform Law

• On Tuesday, the Missouri House gave final approval to a measure that will appear on the state’s Aug. 3 ballot, allowing residents to vote on whether people and employers should be compelled to have health insurance.
• The referendum seeks to defy a provision in the new federal healthcare reform law that requires most Americans to have health insurance or face fines beginning in 2014.
• The legal impact of the Missouri measure is questionable, because courts generally hold that federal laws trump state laws.
• To date, roughly four-fifths of the states have proposed some sort of measure attempting to let people opt out of the federal health insurance mandate.
• Read more: http://www.ahiphiwire.org/Policy/News/Default.aspx?doc_id=575208&utm_source=5/12/2010&utm_medium=email&utm_campaign=HiWire_Newsletter&uid=TRACK_USER

Healthcare Reform Update - 10May2010

2010-05-10T14:40:00.000-07:00

New Regulations Announced for the Extension of Dependent Coverage

The Obama administration announced new rules that will allow unmarried young adults who are not eligible for coverage elsewhere to remain on their parents' insurance until age 26 beginning this month.
The extension of dependent eligibility is mandated as part of the new healthcare reform law, though the original effective date for this provision was Sept. 23, 2010. Moving the effective date up will permit young graduates and others to keep coverage following graduation.
In April, Kathleen Sebelius, the Secretary of Health and Human Services, wrote to insurers throughout the US requesting the move-up date; nearly 70 insurers agreed. Obama requested that employer-sponsored healthcare plans match the earlier date.
This announcement spells out more of the details surrounding this provision:
The option is only a requirement for plans that already offer dependent coverage.
The insurer is allowed to charge more for the adult's dependent coverage if "similarly situated" adults could be charged more.
The policy applies regardless of whether the dependent adult is married or single, but spouses and the dependent's own children do not have to be covered.
There's no requirement for employers to pay the premiums for an added dependent (the law's specifics have yet to be written), but the intention is for all dependents to be treated equally. So if an employer is paying 50 percent of dependent premiums on existing children, then adding an adult dependent should, theoretically, entitle an employee to 50 percent of their premiums being covered as well.
Employees can keep their adult children on their policy, even if they are not listed as dependents on their income tax return.
Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/05/10/AR2010051001306.html

Healthcare Reform Update - 5May2010

2010-05-07T14:19:00.000-07:00

Department of HHS Issues Interim Final Rule on Early Retiree Reinsurance Program

On Tuesday, the Department of Health and Human Services (HHS) released an interim final rule (with comment period) implementing the Early Retiree Reinsurance Program established by the new healthcare reform law.
The statement answers many of the questions plan sponsors have been asking about the program, such as eligibility, how to apply and the reimbursement process.
Under the program, employers can be reimbursed for up to 80 percent of the cost of medical claims between $15,000 and $90,000 for their early retirees. The money can be used to reduce premiums for retirees or for employers to keep their own costs in check.
The law set aside $5 billion to finance the program. The program takes effect June 1, 2010 and ends when all funds have been exhausted but no later than January 1, 2014.
For more information: http://www.washingtonpost.com/wp-dyn/content/article/2010/05/04/AR2010050405171.html
Read the HHS final rule: http://edocket.access.gpo.gov/2010/pdf/2010-10658.pdf

Healthcare Reform Update - 27April2010

2010-05-07T14:16:00.000-07:00

Tax-Free Employer-Provided Health Coverage Now Available for Children under Age 27

The IRS issued guidance today on the tax treatment of healthcare coverage for children under age 27, one of the first federal guidelines to be issued regarding the new healthcare reform law.
Health coverage provided for an employee's children under age 27 is now generally tax-free to the employee, effective March 30, 2010.
The favorable tax treatment applies to a provision in the healthcare reform law that requires plans that provide dependent coverage of children to continue to make the coverage available until the child turns 26. The extended coverage must be provided no later than plan years beginning on or after Sept. 23, 2010.
This means that employees with children who will not have reached age 27 by the end of the year are eligible for the new tax benefit from March 30, 2010 forward. This replaces the lower age limits that applied under prior tax law, as well as the requirement that a child generally qualify as a dependent for tax purposes.
The IRS notice says that employers with cafeteria plans can allow employees to immediately make pre-tax salary reduction contributions to provide coverage for children under age 27, even if the cafeteria plan has not yet been changed to cover these individuals. Plan sponsors must amend their cafeteria plan language to incorporate this change by the end of 2010.
Read the IRS press release: http://www.irs.gov/newsroom/article/0,,id=222193,00.html
Read the IRS notice: http://www.irs.gov/pub/irs-drop/n-10-38.pdf

Healthcare Reform Update - 22April2010

2010-04-23T07:08:00.000-07:00

Health Insurers Commit to Providing Dependent Coverage Before Requirement Begins

Aetna and members of the Blue Cross and Blue Shield Association announced they will change their policies to allow young adults to remain on their parents’ insurance plans months before the new healthcare reform law requires them to do so.
Other carriers have announced plans to offer continuation benefits this spring, including Humana, Kaiser Permanente, UnitedHealth Group and WellPoint.
The new healthcare reform law will require plans to let young adults stay on their parents’ coverage until age 26. This provision is not effective until Sept. 23, 2010.
Some young adults, such as graduating seniors, face a coverage gap during the months before the provision is implemented.
The carriers’ move eliminates the gap in coverage until the provision begins. Graduating seniors who now obtain health coverage through their parents’ health insurance plans will now keep their coverage until they turn 26.
Employers that offer self-insured plans administered by the carriers can decide for themselves whether to offer early access to continuation benefits.
Read more: http://www.lifeandhealthinsurancenews.com/News/2010/4/Pages/Blues-Aetna-Sign-On-To-Young-Adult-Initiative.aspx

Healthcare Reform Update - 31March2010

2010-03-31T09:30:00.000-07:00

American Benefits Council Pressures Congress to Repeal Part of Health Reform Law

The American Benefits Council, which represents 300 companies, is asking Congress and Obama to consider repealing a provision of the healthcare reform law.
The provision under scrutiny reduces the tax deductions for companies that provide prescription drug coverage for their retired employees.

Since 2006, companies have received a 28-percent federal subsidy (up to $1,330 per retiree) on a tax-free basis to help pay for prescription drug coverage for retirees.
Until now, companies could deduct the subsidy from their taxes, essentially receiving a second benefit from the money. (If a company pays $100 in coverage, they would receive a $28 subsidy, yet still deduct $100 in expenses from income for tax purposes.)
Now, companies will no longer be able to deduct the coverage amount, but it remains tax-free.

This provision doesn’t go into effect until 2013, but companies are bracing for the change now.

AT&T announced last week that it was taking a $1 billion charge because of the provision;
Deere & Company announced a $150 million charge.
Boeing expects a $150 million charge.

Many companies say they are taking these charges before the current quarter ends to comply with accounting rules. However, some critics believe the companies’ quick response to the provision is aimed at pressing the administration to repeal it.
Read more: http://www.nytimes.com/2010/03/30/business/30subsidy.html; http://online.wsj.com/article/SB10001424052702304252704575155613728130190.html?mod=WSJ_latestheadlines

Healthcare Reform Update - 30March2010

2010-03-30T10:26:00.000-07:00

President Obama Signs Reconciliation Bill Into Law

At 11:30 this morning, President Obama signed into law the Healthcare and Education Reconciliation Act of 2010.
The Reconciliation Act will merge with the legislation Obama signed last week to create one final law.
The Reconciliation Act changes many of the finer details of the existing health reform law.
For example, it increases the penalties for employers and individuals who do not purchase insurance, as well as increases the federal subsidies provided to help people comply.
The law also includes a large provision aimed at overhauling the student loan system, through which private lenders will be cut out from originating federal student loans. This provision is estimated to save the federal government as much as $7 billion per year.

Healthcare Reform Update - 26March2010

2010-03-26T03:54:00.000-07:00

Congress approves reconciliation healthcare bill

The House approved it late Thursday 220-207 ending a historic week for healthcare reform.
The bill now goes to President Obama for his signature. He is expected to sign it into law early next week.
Obama welcomed debate from Republicans who vowed to campaign for repeal in the fall election season.

Healthcare Reform Update - 25March2010

2010-03-25T05:14:00.000-07:00

Reconciliation bill returns to House

Working until 3 a.m. this morning to review the Reconciliation Bill and a stack of GOP amendments, the Senate parliamentarian found two minor provisions that violate Congress’ budget rules.
This sends the Reconciliation bill back to the House for another vote.
The problematic provisions deal with protecting students from future cuts in their grants if Congress does not provide enough money for them. They violate budget rules because they do not produce savings.
The development came as the Senate completed nine hours of uninterrupted voting on 29 GOP amendments to the legislation. Majority Democrats defeated every amendment.
The Republican amendments were meant to force Democrats to cast difficult political votes before November's congressional elections.
Democrats also deflected GOP amendments:

Rolling back the health law's Medicare cuts;
Killing extra Medicaid funds for Tennessee and other state-specific spending;
Barring tax increases for families earning under $250,000; and
Requiring the president and other administration officials to purchase health care from exchanges the statute creates.

Healthcare Reform Update - 23March2010

2010-03-23T10:28:00.001-07:00

Obama Signs Healthcare Reform Bill into Law; Senate Begins Consideration of Reconciliation Bill

At 11:15 a.m. today, President Obama signed into law H.R. 3950, the approved by the Senate on Dec. 24, 2009 and by the House on Sunday evening. healthcare reform bill
The Senate will convene today at 2:15 p.m. to begin consideration of the reconciliation bill, H.R. 4872.
Obama will now take his health reform campaign to the road to inform Americans of how the legislation will benefit them. He plans to travel around the country in the coming weeks, starting Thursday in Iowa.

Healthcare Reform Update #2 - 22March2010

2010-03-22T16:15:00.000-07:00

Legal and Constitutional Challenges Loom on Healthcare Bill

Republican attorneys general in at least 12 states announced today that lawsuits will be filed to stop the federal government from overstepping its constitutional powers.
States also oppose the expansion of Medicaid that they say infringes on their ability to provide other services.
Attorneys general in Alabama, Florida, Michigan, Nebraska, North Dakota, Pennsylvania, South Carolina, South Dakota, Texas, Utah and Washington plan to band together in a collective lawsuit.
Virginia Attorney General Kenneth Cuccinelli also announced plans to file a lawsuit in federal court.
At least 36 state legislatures are weighing legislation to limit, alter or oppose the federal healthcare reform, and 27 of those are considering amending their state constitutions by ballot.

Obama Will Sign Senate Bill Tuesday

It was announced late today that President Obama will sign into law the Senate legislation on Tuesday.
Shortly after the event, the Senate will begin considering the reconciliation bill, which it hopes to approve before Congress’ spring break beginning March 26.

The personal impact of the healthcare bill

The Washington Post has created tool to help you assess any personal impact with the changes.
Type in a few pieces of information and it tells you if there is any change to your current coverage, etc. http://www.washingtonpost.com/wp-srv/special/politics/what-health-bill-means-for-you/?hpid=topnews
Read about what Medicare tax hikes are anticipated: http://money.cnn.com/2010/03/22/news/economy/medicare_tax_increase/

Healthcare Reform Update - 22March2010

2010-03-22T06:14:00.000-07:00

Sunday, March 21 – House Approves Senate and Reconciliation Bills

The House of Representatives met from 1 p.m. through midnight to consider final health reform legislation.
In an effort to secure last-minute votes in favor, President Obama announced he would issue an executive order after passage attesting that the bill is consistent with long-standing restrictions on the use of federal funds for abortions.
After hours of debate and procedural votes, the House took two main votes on the health legislation:

The House voted on the bill passed by the Senate on Dec. 24, 2009. Members approved this legislation 219 to 212. The bill will now go to Obama to be signed into law.
The House voted on the passage of the reconciliation bill that applies ‘fixes’ to the Senate bill. This legislation passed 220 to 211 and now goes to the Senate for consideration this week.

Next Steps:

Obama is expected to sign the Senate bill into law no later than Tuesday. According to constitutional law, he must sign it before the Senate can take up the reconciliation bill.

The Senate bill will remain law regardless of what happens to the reconciliation bill.

The reconciliation bill will be considered in the Senate beginning on or after the day that Obama signs the Senate bill into law.
Although Senate leaders have promised not to change the legislation, there are a number of anticipated holdups in the Senate that could drag out the process:

All provisions must have a direct budgetary impact or can be removed by any Senator.
The 20-hour limit on debate doesn’t apply to amendments and Republicans have promised a blizzard of them to slow down the process.
The legislation may be subject to committee markups. This would require individual committees to amend and approve the package before a vote in the full Senate could occur.
If the Senate modifies the bill, it will have to go back to the House for another vote.

The following provisions have an impact on Benefitfocus and/or our clients and go into effect within the first year after enactment of the Senate bill:

Creates a temporary reinsurance pool for eligible individuals to provide access to coverage that does not impose any coverage exclusions for pre-existing health conditions. (This provision ends when the Exchanges are operational.)
Initiates the first phase of the small business tax credit for qualified small employers for contributions to purchase health insurance for employees. The credit is up to 35 percent of the employer’s contribution to their employees’ health coverage. There is also up to a 25 percent credit for small nonprofit organizations.
Bars health insurance companies from imposing pre-existing condition exclusions on children’s coverage.
Prohibits insurance companies from rescinding existing health insurance policies except in cases of fraud. (Effective for plan years beginning on or after six months following enactment.)
Prohibits lifetime limits on benefits in all group health plans and in the individual market and restricts the use of annual limits. (Effective for plan years beginning on or after six months following enactment.)
All group health plans and plans in the individual market must provide first-dollar coverage for preventive services. (Effective for plan years beginning on or after the date that is six months after enactment.)
Extends dependent coverage until the child turns 26 years of age. (Effective for plan years beginning on or after six months following enactment.)
Creates a new temporary reinsurance program to help companies that provide early retiree health benefits for those ages 55-64 offset the expensive cost of that coverage.
Requires that any group health plan or plan in the individual market implement an effective appeals process for coverage determinations and claims. (Effective for plan years beginning six months after enactment.)
Requires the Secretary of Health and Human Services to award grants to states to establish health insurance consumer assistance or ombudsman programs to receive and respond to inquiries and complaints concerning health insurance coverage.
Requires the Secretary of HHS to establish an Internet Web site through which residents of any State may identify affordable health insurance coverage options in that state. The Web site will also include information for small businesses about available coverage options, reinsurance for early retirees, small business tax credits and other information of interest to small businesses. So-called “mini-med” or limited-benefit plans will be precluded from listing their policies on this Web site.
Requires enhanced screening procedures for healthcare providers to eliminate fraud and waste in the healthcare system.
Requires that non-profit BCBS organizations have a medical loss ratio of 85 percent or higher in order to take advantage of special tax benefits, including the deduction for 25 percent of claims and expenses and the 100 percent deduction for unearned premium reserves.

Healthcare Reform Update #2 - 21March2010

2010-03-21T19:57:00.000-07:00

History was made tonight as the U.S. House voted to pass the bill that the Senate passed on December 24, 2009. The vote was 219-212.

Immediately following this vote the president will address the nation from the East Room of The White House, where he is expected to sign the bill on the spot.

Next steps include:

The House will now move on to consideration of the reconciliation bill.
The first vote will be on whether or not to recommit (amend) the reconciliation bill. It is expected to fail.
If the motion to recommit fails, the second vote will be on passage of the reconciliation bill.
Assuming the reconciliation bill is approved, it will be sent to the Senate for consideration beginning Monday, March 22.

Healthcare Reform Update – 21March2010

2010-03-21T13:42:00.001-07:00

Agreement with anti-abortion lawmakers appears to give Democrats the votes needed to pass the Senate bill

Rep. Stupak (D-Mich), who led a group of anti-abortion lawmakers in opposing the bill, announced his deal with the White House for his group to vote for healthcare reform.
The agreement Stupak made with the President was announced at a press conference, during which Stupak stated that the agreement “protects the sanctity of life and insures that no public funding for abortion will appear in the healthcare reform legislation.”
The President will sign into a law an executive order after the Senate bill passes to reinforce that there will be no public funding for elective abortions. The anti-abortion lawmakers were satisfied with additional components of this agreement that include a pregnancy assistance fund for indigent mothers.

As of this writing, all news reports continue to indicate that voting on the Senate bill will begin around 8 p.m. tonight with a possibility that it will not be finalized until after midnight.

Healthcare Reform Update #2 - 20March2010

2010-03-20T14:10:00.000-07:00

Breaking News - Pelosi believes she has enough votes to pass the bill in Sunday's vote
The number of Democrats who will vote yes for the bill continues to grow.

As of this writing, Reps. Baron Hill of Indiana, John Boccieri of Ohio, Scott Murphy of New York and Allen Boyd and Suzanne Kosmas of Florida became the latest Democrats to say they would vote "yes" after voting against an earlier version that passed last year.
Many fence-sitting Democrats have reported intense pressure both in favor of and against the bill.
This afternoon, the President took his campaign tour for the bill to the Capitol, urging lawmakers to approve the bill for the good of the millions of Americans who lack health insurance.

Today Democrats dropped plans for an indirect vote that would have relied on a legislative maneuver to give their OK to the Senate's version of health care legislation.

Pelosi is so certain she has the votes she needs that today the following activity for Sunday's session was announced:

First, a vote on bringing the reconciliation bill to the floor and setting terms of debate on the bills;
Second, a vote on the reconciliation bill itself;
Third, a vote on the Senate version of the legislation.
This three step process was set in place to make it clear that the House intends for the Senate bill to be fixed rather than become law as is.
Before reconciliation of the House and Senate bills can occur, however, the President must receive and approve the Senate bill.

Heathcare Reform Update - 20March2010

2010-03-20T09:19:00.000-07:00

Here are the next steps for Healthcare Reform:

Sunday afternoon (this weekend)

It is anticipated that the House will vote on the Senate bill.
Once this occurs, Obama will sign the Senate bill into law.
The House will then vote on the Reconciliation Act and send it to the Senate for debating and an eventual vote.

Week of March 22

The Senate will begin debating on the Reconciliation Act.
This debate could take up to two weeks or more.
If, and when, the Reconciliation Act gets passed by the Senate – unchanged – it will go to Obama to be signed into law.
Note that the Reconciliation Act would lie on top of the Senate bill creating one final law.

We are continuing to monitor healthcare reform news throughout the weekend and will post relevant updates as they occur.

Healthcare Reform Update - 18March2010

2010-03-18T12:00:00.000-07:00

As of 2:26 p.m., the U.S. House of Representatives released the H.R. 4872 - Reconciliation Act of 2010. Included in the release is a Section-by-Section analysis of the Amendment, the text of the Senate Health Bill and the bill as reported by the House Budget Committee.

It is reported that the House will convene on Sunday at 1 p.m. with a vote beginning no sooner than 2 p.m.
We are in the process of reviewing the information to provide you with an update about the sections that will impact Benefitfocus and our clients.
In the interim, here is the link if you’d like to peruse the proposed amendment http://www.rules.house.gov/bills_details.aspx?NewsID=4606.

CBO releases health bill cost estimate; legislative language anticipated to be released later today

The Congressional Budget Office sent House leaders a cost estimate today on their proposed healthcare legislation.
The estimate states that the bill would cost $940 billion over 10 years and expand coverage to 95 percent of Americans. (This would leave 21 million without insurance coverage, many of whom are illegal immigrants.)
The federal deficit would decrease by approximately $130 billion in the first 10 years and by $1.2 trillion over the following 10 years.
The bill costs more than the original draft bills passed by the Senate and the House last fall. However, Democrats were able to keep the deficit reduction figures at the same levels.
Pelosi (D-Calif.) continues to search for the 216 votes needed for passage. It is anticipated that these figures will ease the concerns of fiscal conservatives who have been reluctant vote for the bill.
Legislative language is expected to be posted to the Web site of the House Rules Committee sometime Thursday morning.
The latest changes to the bill would:
Close the donut hole in the Medicare prescription drug program,
Boost subsidies for lower-income individuals to buy insurance, and
Push back the implementation date of the tax on Cadillac insurance plans until 2018.
Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/03/18/AR2010031801153.html?hpid=topnews

Healthcare Reform Update - 17March2010

2010-03-17T14:52:00.001-07:00

As of 5 p.m. Eastern time today, there are no significant updates to report. In monitoring news coverage, we have seen the following:

Two key House members, Kildee (D-MI) and Kucinich (D-OH), announced their support for the final vote of the healthcare bill, bringing the House closer to the 216 votes needed to pass reform.
The CBO still has not released the final score for the reconciliation bill; reports state they are crumbling under a firestorm of requests from members tweaking the bill.
Constitutional questions are being raised about the so-called “Slaughter Rule,” which would allow the House to deem the Senate bill cleared without taking a direct vote.
Mudslinging between the two parties continues, as national news outlets are still reporting news with mostly speculation and hype.

Healthcare Reform Update - 16March2010

2010-03-16T14:48:00.000-07:00

Two summary statements from today’s news: Pelosi could proceed with plan to pass Senate bill without House vote and Still no final reconciliation bill or CBO score.

The House Budget Committee voted Monday to advance the legislation toward a floor vote later this week.

The panel approved a package of fixes to the overhaul by a vote of 21 to 16.
Two Democrats sided with all 14 Republicans in voting against the plan.
37 Democrats remain opposed to the bill, albeit with varying degrees of commitment.

The House Rules Committee can now take up the shell bill after a 48-hour layover.
If the House completes a final vote this weekend, the Senate would take next steps with the bill as early as next week.

Note that debate on reconciliation is limited to 20 hours.
However, amendments do not count toward the 20 hours, so the Republicans could tie this up for some time.

Some speculate that the delay in releasing the bill and CBO score (which was initially supposed to come out as early as last week) suggests that early estimates from the CBO were inaccurate, and they're making changes to get the score that they want.
Democrats need a CBO score that's positive enough to help give fiscal conservatives an excuse to vote for the bill.
Having promised to post the bill online for 72 hours before they vote, the Democrats now have about a day to get a good score if they want to vote by Saturday.

Healthcare Reform Update - 15March2010

2010-03-16T08:19:00.001-07:00

Right now, we know that they went into the House Budget Session at 3 p.m. today to create the shell of the reconciliation bill. This meeting was largely a formality. The House Budget Committee will continue working until a midnight deadline to mark up the "shell" health bill with recommendations for the House Rules Committee.

At least 48 hours must pass between the Budget Committee's completing its markup and the Rules Committee's taking up a bill. It is anticipated that either later tonight or sometime tomorrow the CBO may release the cost estimates for the real reconciliation bill.

In the news today, there continues to be a huge amount of speculation and a fair amount of mud-slinging from both parties.

Reuters and the NYTimes shared that Obama stated this afternoon that he believes they have enough Dem. votes in the House of Representatives to support the plan in a vote later this week (likely Friday or Saturday). Others have reported that this is the “vote of a lifetime” and that “the end game is here.”

Democratic leaders are optimistic that they will have the majority of votes they need to pass it, although they have don’t have 216 committed yes votes as of yet.

Healthcare Reform Update - 12March2010

2010-03-14T12:24:00.000-07:00

Democrats Plan for Health Bill Vote Next Week

The House Budget Committee will begin the reconciliation process on Monday at 3 p.m.
House members have been warned they will stay in session next week until a vote occurs, even if it runs into the weekend.
President Obama has postponed his overseas trip until March 21 in anticipation of passing the bill.
This is part of a two-part strategy to pass legislation.

First: The House will vote on a Senate passed version of a healthcare bill.
Second: A vote on fast-track legislative process, known as budget reconciliation, will occur.

With this approach a simple majority is all that is needed to pass it.

The total cost of the measure is projected to be $875 billion price tag over 10 years with an overall deficit reduction of $118 billion.

Anticipated components include:

The Iowa Kickback and Medicare Advantage money for Florida will not be in the reconciliation bill.
$300 million in additional Medicaid money for Connecticut will remain in the bill.
A proposal to overhaul the nation's student-loan program. (Adding the student-loan legislation is occurring to help find enough votes for the bill.)
Read more here: http://www.politico.com/news/stories/0310/34335.html and http://online.wsj.com/article/SB10001424052748704131404575117651016001706.html?mod=WSJ_hps_MIDDLEForthNews

Healthcare Reform Update - 4March10

2010-03-04T08:20:00.000-08:00

President Obama Reveals Revised Plan for Health Reform; Final Bill Anticipated by Easter (note that every deadline has been missed so far)

President Obama outlined his revised healthcare reform plan in remarks at the White House Wednesday. He urged Congress to pass a final comprehensive bill within the next few weeks.
Obama spelled out changes to the Senate bill that he wants to see in the final reform package. Congress would include these changes in a second “reconciliation” bill that would require a simple majority vote in both the House and Senate.
He included four Republican ideas in his proposed changes to the Senate bill. One idea impacts our portion of the industry – encouraging participation in Health Savings Accounts by offering them in the insurance exchanges.
Congressional leaders anticipate delivering a final bill to Obama by the Easter recess. Meeting this deadline would require three steps:

Step 1 - House approves the Senate bill that passed on Christmas Eve. This requires 218 votes from the House in favor of the bill. Currently, it is unclear if there are enough votes to pass this.
Step 2 - House and Senate pass a subsequent “reconciliation” bill with fixes to the Senate bill (only provisions that impact the budget can be included). This would require only 51 votes in the Senate, so it could not be blocked by Republicans.
Step 3 - House and Senate potentially pass a third bill to address changes to the Senate bill that are ineligible for inclusion in the reconciliation bill. This portion will be hard to pass, as it will require more votes to pass.

Note: Reconciliation is an extremely complex procedure. It will raise numerous legal and constitutional issues. Republicans have vowed to fight the maneuver. Some Democrats have expressed concern with using the tactic. This, coupled with the fact that Congress has missed every health reform deadline to date, means the fight to pass a final bill could drag on past Easter recess.
Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/03/03/AR2010030302213.html?hpid=topnews

Senate Passes Bill Extending COBRA Benefits

Late Tuesday night President Obama signed into law legislation that provides a 31-day extension of federal subsidies for COBRA healthcare premiums.
Under the law, the 65-percent, 15-month COBRA premium subsidy will be extended to individuals who were involuntarily terminated between March 1 and March 31.
Without the extension, workers who were laid off after Feb. 28 would have been ineligible for the subsidy.
Additionally, the legislation will allow employees who meet certain conditions to receive the subsidy if they first lost group coverage due to a reduction in hours and then were terminated after enactment of the legislation.
This week the Senate will continue consideration of separate legislation that would extend the COBRA premium subsidy to employees laid off through Dec. 31, 2010.
Read more: http://www.modernhealthcare.com/article/20100303/NEWS/303039990#

Healthcare Reform Update - 26Feb10

2010-02-26T08:15:00.000-08:00

Thursday’s Health Reform Summit Ends with No Conclusion

After the summit, a few things are clear – Democrats aren’t going to start over, Republicans aren’t going to sign on to Obama’s plan, and the only legitimate hope Democrats have of passing a bill is using reconciliation.
Here’s how this occurred:
President Obama held a bipartisan summit on healthcare reform Thursday in what has been called a last-ditch effort to pass a bipartisan bill.
Attending the conference were 38 members of Congress from both houses and political parties, President Obama, Vice President Joe Biden, and Health and Human Services Secretary Kathleen Sebelius.
There were four main topics for discussion at the conference: cost control, insurance reforms, deficit reduction and expanding coverage.
Although there were modest efforts from the two parties to find common ground, no broad agreements were made on the shape of reform.
President Obama set a deadline of four weeks – by Easter – for Democrats to finish their bill. During his closing statement, he talked of giving Republicans a few weeks to work with Democrats on a compromise.
However, Obama made it clear that he’s prepared to short-circuit Senate rules to get reform passed if Republicans fail to compromise, alluding to the possibility of using the reconciliation process that would only require 51 votes in the Senate to pass a bill.
Read more: http://www.politico.com/news/stories/0210/33571.html

Possible Next Steps include a Reconciliation Option – Here’s how it would work:

Step One – Congress would first pass a reconciliation bill with major, but limited, fixes to the original Senate bill. This bill would address some of the points that House members say must be included in a final reform bill.
Step Two – The House would then agree to pass the Senate bill, requiring a simple majority.
Step Three – Since reconciliation bills can only include elements that directly impact the federal budget, both chambers would have to pass a third bill with policy changes that would not be included in Step One’s bill. For example, the third bill would be needed to make any changes to abortion and immigration provisions in the Senate bill.
There is still no guarantee that Congress will take this path, but as of now it is the only strategy Democrats have offered for passing a comprehensive bill.

House Passes Bill Repealing Antitrust Exemption for Health Insurers

The House of Representatives voted 406-19 Wednesday to pass H.R. 4626, the Health Insurance Industry Fair Competition Act bill.
If signed into law, the bill would repeal the antitrust exemption given to health insurance companies by the McCarran-Ferguson Act of 1945. This law has allowed health insurance companies to be exempt from most federal regulation, including federal anti-trust laws to a limited extent.
Medical malpractice insurers would maintain the antitrust exemption.
It is uncertain when or if the Senate will take up the legislation.
Advocates of repealing the exemption say it has allowed single health insurance companies to dominate local markets.
AHIP believes removing the exemption would hamper data-sharing efforts that they say could help patients.
However, the major health insurers can draw on huge pools of claims data of their own, and insurance company executives have said the antitrust repeal would have little impact on their operations.
Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/02/24/AR2010022404324.html

Healthcare Reform Update - 23Feb10

2010-02-24T05:56:00.000-08:00

We will continue to monitor healthcare reform news and send out updates as they are relevant. There may be an increase in pertinent news for us to share as Obama’s healthcare summit will be held on Thursday, 25Feb10. http://www.politico.com/news/stories/0210/33275.html

Please note that, although the momentum for healthcare reform appears to be building back up, it is still not clear whether Congress will move ahead with a comprehensive bill amid the current political environment.

"Obama Unveils New Healthcare Reform Proposal in Anticipation of Thursday Debate"

President Obama released a $950 billion healthcare reform proposal Monday morning.
The proposal will serve as the starting point for negotiations by Congressional leaders at a bipartisan healthcare summit.
This version is intended to reflect many of the compromises reached during the conference committee before Senator Scott Brown’s election.
Basically Obama’s proposal is very similar to the Senate bill that was being used as a basis for these compromises.
Here are some notable changes:

Delays the tax on high-cost health insurance policies for all plans until 2018, and raises the threshold at which the tax would kick in to $27,500 for an annual family plan, up from $24,000.
Maintains the state-based exchange system under the Senate bill, rather than the national marketplace envisioned by the House.
Pushes back implementation of the taxes on various healthcare industry players, and changes the fee on medical device manufacturers to an excise tax.
Boosts measures to crack down on waste, fraud and abuse in Medicare.
Fully closes the “donut hole” for Medicare prescription drug beneficiaries.
Lowers the penalty on individuals who don’t purchase insurance to $325 in the first year.
Raises the Medicare payroll tax on couples earning more than $250,000 a year.
Gives the federal government sweeping new powers to curb exorbitant rate hikes by health insurance companies.
Boosts tax subsidies for low- and moderate-income individuals to purchase insurance and bigger penalties on larger employers that do not provide health insurance. Absent in Obama’s plan is a public health insurance option.

Healthcare Reform Update - 28Jan10

2010-01-28T08:12:00.000-08:00

Future of Healthcare Reform Remains Unclear After State of the Union Address

After spending most of 2009 emphasizing that healthcare reform was his top domestic priority, President Obama gave it much less prominence in his State of the Union Address Tuesday night. He did not mention it until more than half an hour in, a sign of how unclear the bill’s future has become.
Obama acknowledged that he had not done enough to communicate with Americans about the benefits of reform. He attributed his failure to this lack of communication and to special-interest opposition, rather than flaws in the proposal.
The speech did not resolve differences between the House and the Senate, nor clarify the way forward.
Healthcare was mentioned in a long list of presidential priorities, which included jobs, the economy, deficit reduction, bank regulation, education, energy production and the war in Afghanistan.
The change of tone highlighted the political risks for Obama in spending more time pushing legislation whose fate in Congress is uncertain.
However, Obama showed support for the reform bills, describing them as an immense improvement over the status quo. “As temperatures cool, I want everyone to take another look at the plan we’ve proposed,” he said.
Read more: http://www.nytimes.com/2010/01/28/us/politics/28health.html

Healthcare Reform Update - 19Jan10

2010-01-20T09:55:00.001-08:00

"Republican Scott Brown Wins Massachusetts Senate Special Election"

Republican candidate Scott Brown defeated Democrat candidate Martha Coakley tonight in a Massachusetts special election to replace the late Ted Kennedy in the U.S. Senate.
With 71 percent of precincts reporting, Brown held a 53 percent to 46 percent lead over Coakley.
Brown's victory marks the first time a Republican has won a U.S. Senate seat in Massachusetts since 1972.
While it is a historic win in Massachusetts, Brown's victory has even more critical implications for the national political scene.
Brown will give Republicans a 41st seat in the Senate, which allows them to block passage of the healthcare reform bill and any other legislation that they stand united against.
Democrats have already been meeting to ponder other ways to pass health reform. Options include passing the bill before Brown is seated, or having the House pass the Senate bill outright without compromise, which would send it straight to Obama to sign.
Read more: http://www.nytimes.com/2010/01/20/us/politics/20election.html?hp

In other related news, President Obama has set his State of the Union speech for Wednesday, January 27. Democrats still hope to have a bill in time for the speech, but the results of the Massachusetts election could change that.

Healthcare Reform Update - 18Jan10

2010-01-19T07:20:00.000-08:00

"White House Scores Key Labor Deal"

The White House cut a deal with labor union leaders on how to tax high-cost insurance policies, a key revenue source included in the Senate healthcare reform bill.
Under the deal, union members and government employees would be exempt from a proposed surtax on expensive insurance plans until 2018, five years after the legislation would take effect.
Also known as the "Cadillac tax," the provision would levy a tax on individual insurance plans worth more than $8,500 and family policies above $23,000 annually. Labor unions pushed hard against such a tax, maintaining that it would hurt many workers who have accepted lower wages in exchange for more expensive benefits.
The tax is included in the Senate's healthcare bill, which is the final bill the House will work on to formulate proposed final legislation.
The initial House bill used an income tax on millionaires to finance its package.
Resolving the differences between the two bills' tax structures has been a key stumbling block in finalizing health reform legislation.
Read more: http://www.politico.com/news/stories/0110/31527.html

"All Eyes on Massachusetts Special Election"

Democrats are rushing to finalize healthcare legislation in anticipation of a close race in Massachusetts that could decide the fate of healthcare reform.
The special election being held in Massachusetts on Jan. 19 will decide the replacement in the Senate for the late Ted Kennedy.
If the seat goes to a Republican, it would be the key 41st vote needed to block the bill with a filibuster. (A filibuster is the right to unlimited debate.)
Once considered a shoo-in for the Democrats, recent polls show Republican Scott Brown leading Democrat candidate Martha Coakley. Additionally, last week two widely-known prognosticators (those who call the outcome of an election), the Cook Political Report and the Rothenberg Political Report, changed their rating of the race to a "toss up."
Congress is hurrying the conference committee to assure their legislation is finalized before the election. House Majority Leader Steny Hoyer (D-Md.) said Friday. “I would certainly hope that within the next 24, 48, 72 hours, we have a general agreement between the Senate and the House.”
Read more: http://thehill.com/homenews/campaign/76399-healthcare-talks-in-race-with-massachusetts-special-election

"Democrats Ponder Backup Plan on Healthcare Bill"

Congressional Democrats are contemplating a fall-back plan to pass healthcare reform legislation, even if a Republican victory in Massachusetts deprives Senate Democrats of the crucial 60th vote they need to overcome filibusters.
The most likely Plan B would be to have House Democrats approve the Senate’s healthcare bill, removing the need for an additional Senate vote and sending the measure directly to President Obama for his signature.
Democrats could also try to pass a revised healthcare bill in the Senate before the new Massachusetts senator is sworn in. Or they could try to use a procedural tactic known as budget reconciliation that would require only 51 votes to pass the legislation.
Read more: http://www.nytimes.com/2010/01/18/health/policy/18health.html?ref=policy

Healthcare Reform Update - 12Jan10

2010-01-13T11:25:00.000-08:00

"Unions Denounce Tax on Cadillac Plans"

Labor unions are outraged at President Obama’s endorsement of the proposed tax on high-priced, employer-sponsored health insurance policies that is included in the Senate healthcare bill.
The 40 percent excise tax would apply to individual insurance policies with annual premiums above $8,500 and family policies above $23,000.
Opponents of the tax say it would hit not only wealthy executives with expensive benefits, but also many rank-and-file union members, many of whom settled for lower wage increases in exchange for more generous health benefits.
The House bill does not include the excise tax, and instead would impose a 5.4 percent surtax on wealthy Americans.
The tax is a critical revenue component in the Senate’s bill. Many economists support the tax because of its potential to hold down costs.
On Monday, in a private White House meeting, President Obama told union leaders that he remained committed to taxing high-cost insurance policies as a way to drive down health costs, but signaled he was willing to amend the proposal to “make this work for working families.”
Read more: http://www.nytimes.com/2010/01/09/business/09union.htm

"Massachusetts Senate Race Becoming a Proxy on Health Bill"

The special election on January 19 to decide the late Ted Kennedy’s successor in the U.S. Senate has turned into a proxy battle over the fate of the healthcare overhaul.
Anxious to ensure passage of healthcare reform, Kennedy requested shortly before his death that state law be changed to allow an appointee to fill the Senate vacancy. The legislature consented, and former Kennedy aide Paul Kirk was appointed to the spot in September.
That spot is now up for grabs in the special election, which was considered a guaranteed win for the Democrat candidate. However, new poll numbers show Republican Scott Brown, an anti-healthcare bill dark horse candidate, pulling alongside Democrat candidate Martha Coakley.
Brown has promised to be the 41st vote to uphold a Republican filibuster against the bill, launching a campaign to rouse the state's GOP constituency in hopes that voter turnout could become the game-changer.
Read more: http://www.nytimes.com/aponline/2010/01/12/us/politics/AP-US-Kennedy-Successor.html

Healthcare Reform Update - 11Jan10

2010-01-12T07:54:00.000-08:00

The FY 2010 defense appropriations bill was signed into law on Dec. 19, 2009.

Though it mostly provides funding for defense projects, the legislation also includes money for a two-month extension of unemployment benefits and COBRA medical insurance subsidies that were part of the American Recovery and Reinvestment Act of 2009.
The legislation does the following:

Expands the nine-month, 65 percent COBRA premium federal subsidy to 15 months.
Extends the end date of eligibility for the subsidy from December 31, 2009 to February 28, 2010.
Changes eligibility requirements for the subsidy to only one qualifying event – an “involuntarily termination” of employment on or before Feb. 28, 2010.
Employees who are involuntarily terminated before Feb. 28, 2010 but get COBRA coverage that starts after that date would qualify for the subsidy.
Provides for a 60-day period for the retroactive payment of premiums for assistance eligible individuals (AEIs) who failed to pay their premium for December coverage.
Requires a special notice describing the new subsidy provisions be sent to all AEIs who have been on COBRA on or after Nov. 1, 2009, or whose qualifying event is an "involuntary termination" of employment occurring on or after Nov. 1, 2009.
The U.S. Department of Labor, the U.S. Department of Health and Human Services, and the Internal Revenue Service all could issue guidance concerning the subsidy extension

Implications of the legislation for employers and benefits administrators:

Employers must send extension letters (described above) within 90 days of enactment.
Employers will have to determine the overpayments and decide whether to offset future COBRA premium payments by the amount of the overpayments or issue refund checks.
Employers and COBRA administrators will need to identify beneficiaries whose eligibility for the subsidy ended, send them the required notice and, assuming they pay the required premium, retroactively restore their COBRA coverage.
Since COBRA premiums are not due until 30 days after the start of a monthly coverage period, beneficiaries – if they received notice quickly – would have time to make their December premium payments reflecting the 65 percent federal subsidy.

Read more: http://www.workforce.com/section/00/article/26/91/10.php

Healthcare Reform Update - 8Jan10

2010-01-08T07:35:00.001-08:00

"Democrats Agree to Fast-Track Alternative to Conference Committee"

At the White House Tuesday evening, President Obama and Democratic leaders agreed on a more accelerated alternative to the traditional conference committee between the House and Senate.
Under the informal approach, the two chambers would still have to pass identical bills but there would be minimal opportunity for Senate Republicans to slow the process with procedural moves.
The House would pass the Senate bill amended with new compromise provisions, and then send the package back to the Senate for one final vote.
The goal is to have a bill ready for Obama to sign before his State of the Union address on January 26 or February 2.
Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/01/05/AR2010010503806.html?wpisrc=newsletter

"Obama Signs Bill Extending Jobless Benefits and COBRA Subsidies"

The FY 2010 defense appropriations bill was signed into law on Dec. 19, 2009.
Though it mostly provides funding for defense projects, the legislation also includes money for a two-month extension of unemployment benefits and COBRA medical insurance subsidies that were part of the American Recovery and Reinvestment Act of 2009.
The legislation is detailed in the attached document.
Read more: http://www.workforce.com/section/00/article/26/91/10.php

"Three Health Reform Sticking Points That Worry House Democrats"

The public option, Cadillac Plan, insurance exchanges and financial assistance are each at the center of the debate about how to merge the two bills.
The public option is part of the House bill while it is not part of the Senate bill.
The Cadillac Plan is being opposed on many fronts – from labor groups to a large group of House Democrats. The provision would tax higher cost health plans.
The Insurance exchanges debate is around whether to have state run exchanges or one national one. Also included are debates around employer penalties.
The Financial assistance debate surrounds whether or not to increase subsidies for those who don’t qualify for Medicaid.
Read more: http://www.healthleadersmedia.com/content/LED-244604/Three-Health-Reform-Sticking-Points-That-Worry-House-Democrats

Healthcare Reform Update - 24Dec09

2010-01-07T15:11:00.001-08:00

Senate Passes Health Bill

The Senate approved its final healthcare legislation at 7 a.m. Christmas Eve by a party-line vote of 60 to 39.
The vote ends the twenty-fifth straight day of debate on the legislation, clearing the way for negotiations with the House, which passed a similar bill last month by a vote of 220 to 215.
Negotiations have already begun. Lawmakers hope to have a merged bill in time for Obama's State of the Union Address. However, debates over abortion, taxes and the public option, among other points of tension, could drag the negotiations out until February.

Main Ideas

The bill would require most Americans to have health insurance, and would add 15 million people to Medicaid. The government would subsidize private coverage for low- and middle-income people.
Employers would not explicitly be required to provide coverage.
The bill would enact strict new regulations on health insurers and put in place measures to reform the way healthcare services are delivered.
States would operate health exchanges (Web portals) to allow individuals and small business employees to purchase coverage.
No government-run insurance plan is included. Instead, the bill calls for a national plan run by private insurers, similar to the federal employees health plan.
The Congressional Budget Office estimates the total cost of the bill to be $871 billion over 10 years, reducing the deficits by $130 billion over the same period.
The CBO projects that the bill would provide coverage to 31 million uninsured people, leaving 23 million uninsured in 2019 (less covered than in House bill).
Read more: http://www.nytimes.com/2009/12/25/health/policy/25health.html?_r=1&hp

Healthcare Reform Update - 23Dec09

2010-01-07T13:53:00.000-08:00

"Senate Clears Procedural Steps to Allow Final Vote on Health Legislation"

The Senate voted 60-39 along party lines Wednesday on three steps to allow the final vote on its healthcare bill.
All that remains is a single vote to pass the measure, which requires a simple majority (51 votes).
The vote was originally set for Thursday evening. Democrats announced an agreement to hold the final vote beginning at 7 a.m. Thursday, allowing lawmakers more time to get home for Christmas.
Read more: http://thehill.com/homenews/senate/73487-senate-health-bill-poised-for-christmas-eve-passage

"Discussions on Healthcare Bill Likely to Slip into February"

The White House privately anticipates healthcare talks to slip into February.
Disputes over abortion and the tight schedule are highly likely to delay a final deal.
House Democratic leaders seem inclined, at least for now, to largely accept the compromise worked out in the Senate, meaning it is likely that Obama will eventually get a deal.
Read more: http://www.politico.com/news/stories/1209/30925.html

Healthcare Reform Update - 21Dec09

2010-01-07T13:29:00.000-08:00

“Senate Clears Initial Procedural Vote on Healthcare Reform”
In the early hours of Monday morning, an initial procedural vote in the Senate approved the healthcare bill, putting it on track for passage later this week.

This is the first of three votes needed to pass the bill.
A final vote on the passage of the bill likely will occur on Dec. 24, but the bill still must be reconciled with another healthcare measure passed in the House.
Not a single Republican voted to advance the measure.
Republicans argue that that the bill spends too much to achieve too little and that Democrats pushed the bill through without giving Senators adequate time to review it.
Even some Democrats have been quoted as saying they wish the bill was different, reflecting liberals' unhappiness over some compromises with conservatives in the party.

Here are some quick points to note:

Health insurance coverage would be extended to over 30 million Americans while reducing the federal deficit by $132 billion over the next decade.
There would be NO public option.
Insurance for a family of four making up to roughly $88,000 annually, or 400 percent of the federal poverty level would be subsidized.
They have also agreed to create health insurance exchanges designed to make it easier for small businesses, the self-employed and the unemployed to pool resources and purchase less expensive coverage.
Insurers would also be barred from charging higher premiums based on a person's gender or medical history.
Medicaid would be significantly expanded under both proposals. The House bill would extend coverage to individuals earning up to 150 percent of the poverty line, or roughly $33,000 for a family of four; the Senate plan ensures coverage to those earning up to 133 percent of the poverty level, or just over $29,000 for a family of four.
Individuals under both the House and Senate plans, which still need to be merged for final vote, would be required to purchase coverage, but the House bill includes more stringent penalties for most of those who fail to comply. The House bill would impose a fine of up to 2.5 percent of an individual's income. The Senate plan would require individuals to purchase health insurance coverage or face a fine of up to $750 or 2 percent of his or her income -- whichever is greater.

“Senate Sends Obama Defense Bill That Extends Jobless Benefits and COBRA Subsidies”

The FY 2010 defense appropriations bill passed the Senate on Saturday by a vote of 88-10.
The House passed the bill earlier in the week, so it is now on its way to the White House to be signed into law.
Though it mostly provides funding for defense projects, the bill also includes money for a two-month extension of unemployment benefits and COBRA medical insurance subsidies.
The bill extends these programs through February because Congress did not have time to tackle them separately before its holiday recess.
The expanded unemployment benefits and COBRA subsidies that are being extended were part of this year's economic stimulus package.
Read more: http://www.latimes.com/news/nation-and-world/la-na-defense-bill20-2009dec20,0,5169374.stor

Healthcare Reform Update - 16Dec09

2010-01-07T12:48:00.001-08:00

"Democrats Drop Plan to Expand Medicare"

Senate Democrats dropped a plan to expand Medicare, after it was obvious that the proposal did not have the support of all 60 senators needed to bring the bill for a vote.
The idea of letting people ages 55 to 64 buy into Medicare, announced just last week, had threatened to explode the Democrats' hopes of getting a bill through the Senate when Sen. Joseph Lieberman (I-Conn.) came out against it.
Lieberman has signaled he will likely support the bill now that the provision has been dropped. This would make Sen. Ben Nelson (D-Neb.) the only known holdout among the 60 members who caucus (tend to vote) with the Democrats.
Majority Leader Harry Reid (D-Nev.) signaled he would announce the final healthcare compromise as soon as Wednesday, with a target of final passage by Dec. 23.
Read more: http://online.wsj.com/article/SB126083637029991305.html

"One-Third of Healthcare Dollars Wasted"

According to a new study from Thomson Reuters Healthcare Analytics, fraud, paperwork, unnecessary care and other forms of waste combine to cost around $700 billion a year, about one-third of the total U.S. healthcare expenditure.
The study cites administrative inefficiency and redundant paperwork as two of the causes, totaling between $100 billion and $150 billion.
Read more: http://ebn.benefitnews.com/blog/bythenumbers/-2682671-1.html?ET=ebnbenefitnews:e467:2048774a:&st=email

"Reform Bills Would Force Employers to Cover Dietary Counseling for 27-Year-Old Dependent"

According to Spencer’s Benefits Reports, the healthcare reform proposals in Congress would require employers to cover a number of new preventive and evidence-based care services.
Employers would be required to cover in full:

Certain evidence-based items in line United States Preventive Services Task Force recommendations, the same panel that lit a firestorm of controversy last month with its guidelines on mammography. These services include depression screenings, dietary counseling and substance abuse counseling/interventions.
Immunizations recommended by the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention.
Evidence-based preventive care and screenings for children within guidelines supported by the Health Resources and Services Administration.
Additional women’s preventive care and screenings in comprehensive guidelines supported by the Health Resources and Services Administration.
Read more: http://ebn.benefitnews.com/blog/daily_diversion/reform-could-force-dietary-counseling-27-year-old-dependents-2682674-1.html?ET=ebnbenefitnews:e467:2048774a:&st=email

Healthcare Reform Update - 11Dec09

2010-01-07T12:38:00.000-08:00

"High Premiums in Senate Democrats’ Health Plan"

The Congressional Budget Office provided a preliminary cost analysis for the Senate’s tentative deal to replace the public option.
The deal would create a national health insurance plan provided by private companies and would expand Medicare to those 55 and older.
According to the CBO, premiums for both of these plans would be extremely high, even with federal subsidies.
In 2016, when the health legislation is fully in effect, a family of four earning $54,000 would be eligible for a subsidy of $10,100 to help defray the cost of insurance. However, by then, one of the most popular federal plans, a nationwide Blue Cross and Blue Shield policy, is projected to cost more than $20,000.
For people ages 55 to 64 looking to “buy in” to Medicare, the premiums could cost about $7,600 a year per person or $15,200 for a couple, according to a budget office analysis of an earlier version of the concept. No subsidies would be available until 2014, though the buy-in option would begin in 2011.
Read more: http://www.nytimes.com/2009/12/11/health/policy/11insure.html

"CMS: Health Bill Excise Tax Could Bend Curve"

Imposing a 40 percent excise tax on “Cadillac” health plans might be fairly effective at holding down the cost of healthcare, according to the Centers for Medicare and Medicaid Services (CMS).
Richard Foster, chief actuary for CMS, declined to include the projected effect of the excise tax in his official analysis, but said that “affected employers would reduce their benefit packages in such a way as to eliminate about three-quarters of the current excess benefit value.”
According to Foster, the effect of the tax would grow over time because of the relatively rapid increases in health insurance costs.
In 2019, the excise tax could reduce the total $4.7 trillion in national health expenditures about 0.3 percent, or about $15 billion.
Read more: http://www.lifeandhealthinsurancenews.com/News/2009/12/Pages/CMS-Health-Bill-Excise-Tax-Could-Bend-Curve.aspx?nul

Healthcare Reform Update - 09Dec09

2010-01-07T12:31:00.001-08:00

"Senate Democrats Reach Tentative Compromise on the Public Option"

Democratic Senate negotiators struck a tentative agreement Tuesday night to drop the controversial government-run insurance plan from their healthcare legislation.
The agreement would replace the public option in the current Senate bill with a new national insurance plan offered by private insurers, and would allow Americans to “buy in” to Medicare beginning at age 55.
The deal also included a proposal to reauthorize CHIP (Children’s Health Insurance Program), which is set to expire in 2013.
Though the public option has not officially been dropped, senators agreed to ask congressional scorekeepers to provide a cost estimate on the alternative.
Senate Majority Leader Harry Reid (D-Nev.) has been working with top Democrats over the past two weeks to forge a compromise on the public option that would win him the 60 votes needed to block a Republican filibuster. Once Reid is certain he has 60 senators in support of the bill, he will file for closure, effectively ending debate and setting up the bill for a vote.
Read more: http://www.nytimes.com/2009/12/09/us/09health.html?_r=1&hp

"Survey: Health Costs, Reform a Source of Stress for Americans"

A new survey conducted by Misericordia University and Braun Research found that two in five Americans plan to spend less this holiday season as a result of rising health costs, and three in 10 said healthcare costs have led to arguments and tension with friends and family members.
The Healthcare in America survey also concluded that the healthcare reform debate is a cause of stress and annoyance among the majority of Americans.
Those surveyed reported that their top concerns with healthcare reform include the cost to future generations and its impact on the federal deficit, the cost of out-of-pocket expenses, and the accessibility of quality coverage.
Read more: http://www.healthleadersmedia.com/content/243190/topic/WS_HLM2_LED/Survey-Health-Costs-Reform-a-Source-of-Stress-for-Americans.html

Healthcare Reform Update - 07Dec09

2010-01-07T12:19:00.001-08:00

"Senate Democrats Find Alternative to Public Option"

A new alternative to replace the public option in the Senate bill emerged over the weekend — for the government to create a national health insurance plan similar to the Federal Employee Health Benefits Plan.
The plan would be administered by the Office of Personnel Management, which oversees the federal plan for members of Congress, and all of the insurance options would be not-for-profit ones offered by private companies.
Currently, the Senate bill calls for a government-run insurance option with flexibility for states to opt out. Although it is not official yet, this alternative appears to be the front-runner to replace the public option.
Read more: http://www.politico.com/news/stories/1209/30255.html

"CBO Looks Critically at Senate’s Health Insurance ‘Exchange’ Proposal"

According to a Congressional Budget Office (CBO) report, people buying health insurance through the Exchange would pay higher premiums for their plans than under current law.
According to the report, the higher premiums are the result of the requirement that insurance companies offer a greater level of coverage in the plans they sell.
However, new subsidies that would cover almost 60 percent of the premiums would offset the increased costs for more than half those purchasers.