Pink Fire Pointer 2010

Healthcare Reform Update - 15June2010

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:

Healthcare Reform Update – 14June2010

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:

  • Read the regulation:

Healthcare Reform Update – 10June2010

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:

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:

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:

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:,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:

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.

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.

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.

Healthcare Reform Update - 04June2010

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
  • Read more:

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:

*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 
  • Read the press release:

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:

  • The Washington Post’s Ezra Klein speculates what might happen if the Supreme Court rules the individual mandate unconstitutional:

  • BNET Healthcare recently posted an article highlighting the strain of healthcare reform on employers:

Healthcare Reform Update - 18May2010

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:

Healthcare Reform Update - 17May2010

IRS Issues Guidance for Small Business Tax Credits,,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:

Healthcare Reform Update - 12May2010

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:

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:

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:

Healthcare Reform Update - 10May2010

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:

Healthcare Reform Update - 5May2010

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:
  • Read the HHS final rule:

Healthcare Reform Update - 27April2010

 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:,,id=222193,00.html

  • Read the IRS notice:

Healthcare Reform Update - 22April2010

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:

Healthcare Reform Update - 31March2010

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.Find all the info that you need about " good research essay topics orderessay " at
  • Read more:;

Healthcare Reform Update - 30March2010

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

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

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

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

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

Healthcare Reform Update - 22March2010

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:
    1. 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.
    2. 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

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

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

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

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

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

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:

Healthcare Reform Update - 17March2010

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

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.