Wellness Programs in PPACA Spotlight

Under the Patient Protection and Affordable Care Act (PPACA), wellness is one element of health care reform that is taking center stage. 

Generally, health plans may not discriminate based on a health factor against individual participants with regards to eligibility, benefits, or premiums (health factors include health status, medical condition, claims experience, receipt of health care, medical history, genetic information, evidence of insurability, and disability). However, an exception to this rule allows for premium discounts, rebates, or modifications to otherwise applicable cost sharing in return for adherence to certain programs of health promotion and disease prevention, otherwise known as wellness programs.

Understanding the Impact of PPACA’s Health Insurance Premium Tax

Beginning in 2014, many Americans will start paying for a new tax on health insurance that will be assessed against health plans and insurers but will actually be paid through increased premium rates, according to several prominent insurance and financial experts. Buried within the Patient Protection and Affordable Care Act (PPACA), Section 9010 requires individuals, families, and others to help pay a total of $73 billion over five years.  Implementation of this provision is generating mixed reviews by various stakeholder groups.   

Obama Administration Defends Affordable Care Act in Opening Brief Filed with U.S. Supreme Court

On January 6, 2012, the U.S. Department of Justice (DOJ) filed a brief with the U.S. Supreme Court in support of the Patient Protection and Affordable Care Act (PPACA), one of the most talked about pieces of legislation passed in recent memory. In addition, over a half dozen amicus curiae briefs have been filed since then by interested parties wanting to weigh in on the case.  Oral arguments on the merits of the new health care reform law are scheduled for late March. 

Health Insurers Facing New Financial Pressure Points under Emerging Reforms: MLR Restrictions & ICD-10 Conversion Add to Complexity

The Patient Protection and Affordable Care Act (PPACA) is not only forcing health insurers to undergo fundamental changes in the way they do business, but the law is requiring new infrastructure investment while also mandating Medical Loss Ratios (MLR) that limit the amount insurers can spend on administrative costs.   

U.S. Congressional House Subcommittee Holds Hearing on Medical Loss Ratios – Concerns Expressed about Broker Role

Last Thursday, the U.S. House of Representatives Small Business Subcommittee on Investigations, Oversight and Regulations held a hearing on the issue of the Medical Loss Ratio (MLR) in Washington, D.C. Titled “New Medical Loss Ratios: Increasing Health Care Value or Just Eliminating Jobs?,” the hearing was a forum for views on how the MLRs mandated by the Patient Protection and Affordable Care Act (PPACA) could impact the health care insurance industry. Most individuals testifying expressed concerns about how the MLR formula as currently structured could greatly hinder the ability of brokers and agents to support consumers and business owners when purchasing health insurance.

HHS Announces Medical Loss Ratio Rule

The Department of Health and Human Services (HHS) just released its final Medical Loss Ratio rule, and the outcome does not bode well for the broker/agent community. In the ruling HHS has rejected the NAIC recommendation to exclude broker/agent fees from insurance companies’ allowed administrative costs.

Under the rule beginning this year, individual and small group market insurance plans will be required to spend 80% of the premiums on medical care and health care improvement. Only the remaining 20% will be allowed towards administrative costs. Much the same, large group plans will have an 85% of premium requirement.

Additional Details on NAIC MLR Resolution While HHS Continues to Process State Waivers

Last week, BenefitMall reported on a hotly debated resolution adopted by the National Association of Insurance Commissioners (NAIC) to adjust the Medical Loss Ratio (MLR) formula to recognize the role of professional health agents and brokers. (To read the blog, click here).

Institute of Medicine Releases Report on Essential Health Benefits: Concerns Remain about Establishing Accurate Baseline Premium Assumptions

One of the hallmarks of federal health care reform efforts is to provide standardized insurance coverage to small employer groups and individuals through state-based exchanges when federal subsidizes are warranted. Yet, concerns have grown over the past year about the emerging price tag associated with some of the mandates issued pursuant to the Patient Protection and Affordable Care Act (PPACA). 

HHS Retooling Pre-Existing Condition Insurance Plan to Increase Enrollment: Brokers Part of the Revamped Strategy

Brokers got a bit of good news this past week when the U.S. Department of Health and Human Services (HHS) announced a new program to reduce premiums and work with licensed health insurance agents and brokers to make it easier for individuals to enroll in the federally administered Pre-Existing Condition Insurance Plan (PCIP). HHS noted in a recent statement that “Congress created the temporary PCIP program as part of the Affordable Care Act to help uninsured Americans with a variety of medical conditions get affordable coverage rather than be locked out of the system by insurance companies.”[1]  A major problem was that enrollment was significantly below previously estimated government targets.    

PCIP Overview

Low Enrollment for Pre-Existing Condition Insurance Plan

One of the biggest obstacles with obtaining health care was the limited access that people with pre-existing conditions had to health care coverage.  A new plan – the Pre-Existing Condition Insurance Plan – was launched this summer as part of the Affordable Care Act. It’s meant to provide access to health care for those denied coverage due to pre-existing conditions.

To meet the criteria, a person must have problems getting health insurance because of a medical condition and have been uninsured for at least six months.

When putting together this plan, government economists predicted 375,000 people would enroll and gain coverage this year alone. They questioned if the $5 billion allotted for this program would be sufficient.

It turns out it’s more than sufficient.