Atena Reports on Health Care Reform Nov. 24, 2010

Aetna reports:

“ILLINOIS: The state’s Health Care Reform Implementation Council is requesting public comments on a proposed health insurance exchange. The Council is tasked with providing guidance to the Governor on how Illinois should develop an exchange, as stipulated by PPACA. The Council is requesting comments

on several key issues related to the insurance marketplace, the option of establishing an exchange, and how implementation of these reforms and a state-based exchange can coexist with existing state programs. Comments are requested specifically on the functions of an exchange; its structure and governance; external market and adverse selection issues; financing; and eligibility determination. The Council will file a report by Dec. 31, 2010.

In addition, the DOI has issued emergency regulations applicable to carriers issuing coverage to individuals under 19 years of age in the individual health insurance market on or after September 23rd. The proposed emergency rules require carriers issuing child-only policies to accept applications for enrollment during a one-time open enrollment period from January 1 through January 31. Applications accepted during an enrollment period will become effective on March 1. Thereafter, biannual open enrollment periods for new applicants will be held each July and January. During open enrollment, all child-only plan applicants under the age of 19 will be offered coverage regardless of prior health conditions. In addition, enrollment will be available for those children who have a qualifying event, such as birth or adoption. To promote continuation of coverage, a child-only policy is subject to a surcharge of up to 50 percent of the standard rate for up to 12 months, should there be a lapse in the plan within the 12 preceding months. To prevent market disruption, carriers are permitted to cancel coverage for dependents in the individual market should a parent subscriber drop coverage in an attempt to make the child a child-only subscriber.

FederalCongress returned last week for the first of two lame duck sessions; the first one for the week of November 15 and the second to start November 29 and last until mid-December. Given the results of the election and the size of the Republican majority in the House (largest since 1948), the first week back was more about organizing and posturing than anything called legislation. As to leadership, each party in the Senate re-elected the very same team from the last Congress to serve in the upcoming 112th Congress (2011-2012). As expected, the House Republicans elected Ohio Congressman John Boehner as the incoming Speaker, with the remaining Republican leadership posts aligning with the same pecking order as in the 111th Congress. House Democrats pretty much followed the same pattern with Nancy Pelosi (soon to be ex-Speaker) elected as Minority Leader, even though conservative Democrats waged a futile battle to oust her. Once Democrats created a brand new 4th spot within leadership for current # 3, James Clyburn (South Carolina), the battle for Minority Whip dissipated and went to current Majority Leader, Steny Hoyer (Maryland). As for legislation, Congress did nothing on many key issues but is expected to act in the second lame duck session on the expiring Bush tax cuts, the Continuing (budget) Resolution to keep the government operating (expires December 3), and repeal of the new 1099 reporting requirement that PPACA imposes on small business.The Senate, however, took a baby step toward staving off a 23 percent cut to Medicare physicians, set to begin on December 1, by approving a measure halting the cut until until January 2011. The House is expected to pass this measure when Congress returns for its second lame duck session. Just in case there are Congressional delays, CMS has already announced a suspension of claims processing until December 14 so that any delay in House passage does not lead to an actual cut in physician payments. Just how Congress will deal with the scheduled 2011 cut of 26 percent remains an open question, one that must be answered by the next Congress.Only the regulators are pumping out paper with meaning. This week HHS announced that it was issuing regulations that follow closely the National Association of Insurance Commissioner’s (NAIC) recommendations for implementing a new medical loss ratio (MLR) requirement as part of the Patient Protection and Affordable Care Act PPACA). Starting next year, PPACA requires that insurers spend 80 (small group and individual) to 85 percent (large group) of the premium dollar on medical services or face the prospect of providing rebates to consumers. The new regulations outline disclosure and reporting requirements and how insurers must calculate MLRs. You can read what America’s Health Insurance Plans had to say about the new regulations by clicking here.Last week key federal agencies (Labor, Treasury, HHS) issued a revision to a previously issued Interim Final Regulation on grandfathering that set forth the rules allowing consumers to “keep the coverage they have” as of March 23, 2010, the date the President signed PPACA. The revision announced last week provides additional flexibility for fully insured grandfathered plans by allowing them to change insurers without jeopardizing their grandfathered status the same way a self-insured plan can change third-party administrators (without losing grandfathered status).”