Sunday, April 25, 2010

Health Care in America: A Layman Reads the Health Care Bill - Part 2

Hello loyal reader(s). We're back with another installment of the Health Care Act reading. In this episode, we will actually begin reading the act. As I mentioned last time, the first part of the legislation ("Subtitle A") is a series of amendments to the Public Health Service Act. Now, I'm no expert, but as far as legislative amendments go, these are pretty exciting. No, seriously.

Considering that I haven't actually read the original text of the Public Health Service Act, I'm not sure what these amended sections originally said (or if they even existed, as opposed to being amendments adding sections to the act). But a quick rundown of the 26 pages of amendments follows:

Amended section 2711 - This section states that there can now be no limits on dollar amounts per beneficiary, and no "unreasonable" annual limits on the dollar value of benefits for an enrollee in a program. There is a caveat - if a plan is not providing "essential benefits" it can have limits on "specific" (though unspecified) covered benefits as permitted by law. Apparently we can see section 1302(b) of the Patient Protection and Affordable Care Act (i.e. the new health care bill) for explanation. Presumably we'll get there at some point in this process.

Amended section 2713 - This section discusses coverage requirements on preventive health services. Insurance companies must cover, without cost-sharing, the following:

  • 'A' or 'B' rated services according to the U.S. Preventive Services Task Force...I don't know what that means;
  • immunizations recommended by the CDC Advisory Committee on Immunizations, which seems reasonable to me;
  • preventive services for infants, children, and adolescents supported by the Health Resources and Services Administration, which again seems like a reasonable source;
  • U.S. Preventive Service Task Force recommendations regarding breast cancer screenings, mammography and prevention, etc.
It is pointed out that this list does not prohibit services other than those recommended by the U.S. Preventive Service Tast Force. So they're just not limiting options, here.

Amended section 2714 - This section is the one I was most familiar with so far. It states that a covered person's dependent will continue to receive coverage until they are 26. This takes place immediately. It's a short section.

Amended section 2715 - This section is about explaining coverage. It's a long section. But I actually really enjoyed reading it because it is so obviously needed for protecting consumers. I'm glad that out of 2000-odd pages, it seems like there's actually some substance to this bill!

The short version is that all insurers will have to issue summaries of their coverage to any enrollees - before they enroll, or any enrollee already in a coverage plan.

The requirements are almost entertainingly specific. For example, all summaries must be 4 pages or less, and cannot contain print smaller than 12 point font. You can almost see those fine-print writing guys throwing their hands up in exasperation on reading that rule. Other highlights - the summaries must be "linguistically and culturally appropriate" to the enrollees, and understandable by the average enrollee; must include definitions - of insurance and medical terms, coverage descriptions that must include cost-sharing descriptions, exceptions, reductions and limitations, deductible/co-pay/co-insurance explanations, renewability, even common examples of coverage scenarios such as pregnancy, chronic conditions, etc. They must also include a clear statement that they are only summaries along with contact info for questions and website listings where the full contract can be found.

The summary has to be delivered within 2 years of passage of the bill (so March 2012) to applicants, enrollees prior to enrollment or reenrollment, and policy holders. They must be available in both electronic and paper format.

Also, insurers are required to communicate plan changes to policy holders at least 60 days prior to effectiveness.

Failure to fulfill any of these requirements will incur a maximum penalty of $1000 per offense. I'm unclear if that means, for example, $1000 per each change that's not communicated, or $1000 per change for each policy holder they fail to contact. I hope it's the latter, but that's just me.

Amended section 2716 - This is another short section. It simply notes that, in group plans, elegibility rules cannot be established that discriminate based on salary. My understanding here is that if your company has a group plan, it can't make elegibility for the really good coverage cost a high dollar amount that will preclude lower level employees from being able to afford it. Elegibility can, however, be based on a percentage of income, so everyone pays, for example, 10% of their income for the better coverage. The goal seems to be that everyone could afford to pay for that coverage, regardless of their wage level. Whether or not they will all decide to do that, when another option could cost only 5% of their income, is up to the employee.

Amended section 2718 - I really like this section, too. Insurers will have to start reporting the percentages of premium income spent on the following 3 categories: 1). Enrollee reimbursement; 2). Quality of health improvement activities for enrollees; 3). all other non-tax expenditures, along with an explanation of those expenditures. These reports will be available for public viewing on the Health and Human Services website.

The next part of the amendment I'm a little shaky on, but I'll do my best. As I understand it, the reports will be used for requiring insurers to grant rebates to enrollees on a pro rata (anyone speak Latin?) basis if they spend more than 20% (for the group market) or 25% (for the individual market) of the premium income on that 3rd group of expenditures. So if your insurer spends 30% of what they take in with premiums on anything other than their policy holders' medical reimbursements or quality of health improvement programs, they have to send you a rebate of some sort.

I think that rocks. I don't personally enjoy the idea of spending nearly 1/2 of my income (according to an NPR report last year, by 2015 Americans will spend about that much on health insurance) on making insurers really really really rich. That's shenanigans.

Along with the rebates, the amendments also require hospitals to publish a list of "standard charges" for items and services provided, so consumers can compare and see what kind of a mark-up they're paying the insurance company (at least, that's what I understand to be the purpose of those lists).

Ok, the last two amendments have to do with consumer education and protection.

First, Amended section 2793 discusses the creation of grants to fund consumer assistance/ombudsman programs to answer questions, explain consumers' rights and responsibilities, and help with consumer appeals to insurance companies within the state exchanges. In case anyone missed it, at some point we learned that there will be private insurance exchanges created in each state (I think it's each one) from which people will be able to buy insurance at a (hopefully) reduced rate, due to competition between insurers. We'll see how that all works out, but right now we're just talking about essentially a consumer hotline and 1-stop-shop to get their insurance questions answered. The federal government will set aside an initial $30 million in grants to establish these facilities. States will have to apply for the grant money for their programs. Each state that qualifies for a grant will get between $1 million and $5 million in grant money.

Amended section 2794 further amends the last section, creating a review process which will require insurers to submit justification for "unreasonable increases" in premiums to the Secretary of the health care administration. The consumer assistance/ombudsman facilities will, in order to get the grant money, also have to engage in collecting info like that from the insurers in their states. That info on premium increases will then be evaluated to determine if an insurer gets to stay in (or gain initial entry to) the exchange program. This amendment also provides for another $250 million in grant money, if necessary, for the assistance offices between 2010 and 2014. Not sure what happens after 2014, but I guess we'll just have to see if there's any more info on that later in the bill. Lord knows there's room for it.

The final section just explains that, unless otherwise specified, all these amendments are effective in September 2010 (6 months after passage of the bill). Sections 1002 and 1003 (these last sections about the assistance and grants) go into effect immediately.

Congratulations! We've completed the first part (Subtitle A, to be specific) of the health care bill! Wasn't that fun? Well, it could have been worse, I suppose. Maybe. Honestly, I'm pretty impressed with it so far. I haven't come across anything that's grossly harmful to the average citizen, and while a lot of this stuff may make it harder for insurance companies to become trillion dollar businesses, that's honestly not a problem for me. I want to pay the insurance company to give me insurance, you know, help, if I need it. And for you to get help, too. Not for them to buy Jaguars. I don't care if they have to drive lame Ford Focuses like the rest of us (seriously, how many of those freaking cars have been sold? It's like 1 out of every 3 cars if a freaking Focus!...sorry, that was random). I'd be interested in any thoughts, questions, challenges to my interpretation that anyone has. Otherwise, I get kinda bored just sitting alone in a room reading health care legislation.

In any case, we'll see you next time, when we begin...wait for it...this is gonna be exciting...Subsection B! Woohoo!


angiejean said...

Good job! Yikes, if Amanda weren't around I'd be worried about you. :) Doesn't this prove that you are an academic at heart?

Aunt Mary said...

Thank you, Joseph, for undertaking this daunting task, for sharing your insight, and especially for providing your light-hearted commentary. Who needs sleeping pills when you've got federal legislation to read!

Clayton said...

You should pitch this as a show to PBS - "citizens reading legislature"!

Or would that be a better late night NPR call in show?

Keep it up Joe, we're rooting for you!