Thursday, May 13, 2010

Health Care in America: A Layman Reads the Health Care Bill - Part 4

In this installment of the health care act reading, we'll be looking at Subtitle C: Quality Health Insurance Coverage for All Americans. This subtitle is broken up into 2 parts, so that's how I'll break up the post as well. The first part is yet another set of amendments to the Public Health Service Act. That is followed up with a foray into the rights concerning existing coverage. Let's get started!

Subtitle C is a pretty exciting subtitle, and I don't mind saying so, and the bulk of it is found here in Part 1. Here, Sections 2701 - 2708 are amended. Rather than breaking them down one by one bullet-point style, I'll just give you the gist of it all at once.

First, we eliminate exclusions and discrimination based on preexisting and other health conditions. Apparently, the Public Health Service Act specifically allowed for such discrimination, but it's off the table now. Also changed are the rate and reasons for which premium rates can vary. Now, the only variance allowed is based on: individual vs. family coverage; age (not more than 3 : 1); tobacco use (not more than 1.5 : 1); and rating areas, which will be established by each state. Also of note, here, is that age and tobacco variations have to be proportionate. So if 1 person in your family of 5 would be affected by those variances, your premium can only be affected by that same proportion.

Another major change in these amendments is that health plans cannot discriminate against people based on what they're calling "health status." First, eligibility rules are stated, listing several examples of health status factors such as "health status" (wow, thanks!), medical condition, claims experience, medical history, genetic information and disability. Second, to put those factors into practice, the amendment prohibits "wellness programs" and disease prevention programs with rewards (like premium discounts and rebates) if they require the fulfillment of a health status requirement to achieve. So, a program cannot require that, for example, an individual meet a certain weight requirement, or run a given distance or lift a required amount of weight in order to receive a premium reduction or rebate. Those goals may not be medically feasible (or advisable) for certain people, so they are not valid goals in these programs. There are, of course, exceptions to this rule. In order to be legal, such a program must meet the following requirements:

  1. The discount must be equal to less than 30% of the total cost of coverage
  2. The program must be "reasonably designed to promote health or prevent disease" and can't be "subterfuge for discriminating based on a health factor" and, my favorite, can't be "highly suspect" in the method of health promotion or disease prevention. You gotta love legislative language, eh?
  3. It must have open eligibility at least once a year
  4. It must be available to all "similarly situated" individuals, and offer alternative standards for cases in which achieving the standard is medically dangerous or inadvisable. And whenever one standard is listed in the program literature, they must both be listed.
These programs will have a 10-state, 3 year demonstration period (from 2014 - 2017), and if they work they can then be expanded. Part of that demonstration will include, of course, a report , which will note what programs and rewards were most effective at promoting health and preventing disease, which were cost-effective, and how much they might cost the federal government if they were implemented on a more broad (i.e. nation-wide) scale.

Other notable changes in the amendments:
  • Insurance issuers have to grant coverage to all who apply
  • Renewability of coverage is guaranteed
  • Insurance issuers cannot discriminate against health providers (i.e. hospitals/doctors) if they meet plan requirements and, of course, are practicing legally
  • All health insurance plans must meet certain "comprehensive" coverage requirements, which will be enumerated later in the legislation, and will be called "essential benefits"
  • Excessive waiting periods are prohibited - apparently we'll hear more about this in Section 2704(b)(4)
Part 2 of Subtitle C deals, as we said, with existing coverage. This part is pretty simple. Basically, if you have health insurance, either from the individual market or as part of a group plan (like through an employer), the amendments in this subtitle (C) and in subtitle A will not apply to your insurance. Even if you renew your insurance, the changes won't take effect, as long as there are no changes to your coverage. Also, if it was possible for your family to join your plan before, they can still do so without the changes. And if your employer has a plan (i.e. a group plan) they can continue to enroll new employees (and families, as applicable) without the changes. If your health plan is part of a collective bargaining agreement, none of these changes will take effect until the last part of the agreement expires.

Two other little tidbits from this subtitle - all standards have to be applied uniformly to all health insurance issuers; and all amendments in Subtitle C are effective for plan years on or after January 1, 2014.

So that's it! That's Subtitle C, in all its glory. Stay tuned for the next installment - Subtitle D, the longest subtitle yet! And let me tell you, it's a real page turner. All 30 or so pages of it!

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