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8-18-11 Affordable Care Act Update
August 18, 2011
Federal Update
In the past week, the Administration issued four proposed regulations that are important components of building a new available, affordable, and comprehensive health insurance system.
The regulations complement and supplement the health exchange regulation proposal issued in July. The proposals are very detailed blueprints for various functions will operate, and collectively will provide a much more coherent insurance system for consumers. ACS CAN will review these proposals and consider making comments, probably in coordination with other consumer groups.
Health Insurance Premium Tax Credits
Issued by the Treasury Department, the proposal lays out the rules for obtaining subsidies for private insurance in the health exchanges. Generally, this affects people between 133 and 400 percent of the federal poverty level who may be eligible for premium subsidies. The proposal explains the process for collecting and verifying information necessary to determine eligibility, and it explains how various changes will be addressed (e.g. if a person’s income changes significantly during the year, when a dependent might be eligible for subsidies separate from parents, etc.). Read the Treasury Department fact sheet.
Eligibility Determinations for Exchange Participation and Insurance Affordability Programs and Standards for Employer Participation in Small Business Exchanges
Issued by the Department of Health and Human Services (HHS), this proposal explains when a person is eligible to participate in an exchange and how to apply for assistance, including
Medicaid and premium subsidies. The regulation explains the parallel rules for small businesses wanting to purchase coverage through a small business exchange if a state offers one. Read the
HealthCare.gov fact sheet and a Reuters article.
Medicaid Eligibility and FMAP Rates
Issued by the Center for Medicare and Medicaid Services at HHS, the proposed rule collapses a number of existing categories, including optional groups under 133% of the federal poverty level (FPL),
such as women in the Breast and Cervical Cancer program, into four primary categories of coverage. In 2014, these categories will be children, pregnant women, childless adults under 133% FPL, and
parents and caretakers above 133% FPL. The proposed rule also coordinates eligibility with the exchange by standardizing the definition of income eligibility and household composition. Read the
HealthCare.gov fact sheet.
Summary of Benefits and Coverage and Uniform Glossary
Issued by the Departments of Labor, HHS, and Treasury, this proposal addresses a requirement in the Affordable Care Act that individual market and small group market plans provide all applicants with
a summary of benefits and coverage as well as a uniform glossary of terms. (Large plans will likely be required to do so at a later date.) This is an important component of the fourth “A” – administrative
simplicity -- in the American Cancer Society and ACS CAN’s four “A’s” of meaningful health coverage. The objective is to provide all consumers with basic information they can use to compare plans and
begin to understand differences. The final product will probably be four pages long and include a “typical” breast cancer case to show total costs and the consumer’s likely share for the deductible and
co-pays or coinsurance. (The “typical” case being used for breast cancer is based on a model Georgetown University developed for ACS CAN.) Read the HealthCare.gov fact sheet, view the proposed
template, and see the Kaiser Health News coverage.
State Update
In tandem with its announcement of new regulations on the exchanges, HHS released $185 million to 13 states and the District of Columbia to support the creation of state exchanges. Three states – Indiana, Rhode Island, and Washington State – received such grants in May. Only states that have taken some type of action to establish an exchange, though not necessarily enacting legislation, were eligible. Read more in CQ. Also of interest, a Commonwealth Fund blog post by Rhode Island’s State Insurance Commissioner on setting expectations for exchanges.
Litigation Update
Last Friday, the 11th Circuit Court of Appeals issued its decision in the case brought by 26 state Attorneys General to invalidate the Affordable Care Act on the grounds that the law is unconstitutional. By a vote of two to one, the three judge panel struck down the provision requiring individuals to purchase health insurance -- the so-called "individual mandate" -- as exceeding Congress's authority to regulate commerce under the US Constitution. The ruling left the rest of the law intact, saying that the mandate could be severed from other provisions of the law. The decision also marks the first time that a judge nominated by a Democratic president, Bill Clinton-appointee Frank Hull, has ruled in favor of striking down the individual mandate. Read a story from the PBS Newshour.
The 11th Circuit ruling stands in contrast to a similar case heard in the Sixth Circuit, which upheld the law in its entirety. This "circuit-split" virtually assures that the Supreme Court will consider the various challenges, most likely accepting a case in the fall for decision in the spring of 2012.
.A decision is still pending from the Fourth Circuit Court of Appeals. Experts believe the Fourth Circuit will rule by Labor Day. More than 30 cases challenging the individual mandate have been filed across the country.
State Exchanges Workgroup
On August 16-17, ACS CAN convened a workgroup of Division government relations directors to plan the next stages of Affordable Care Act implementation, with a specific focus on the states' ongoing work to develop state insurance exchanges. ACS CAN staff will consult with the workgroup to develop of new resources and update existing materials as well as to plan an in-person training to be held later this year.
Christopher W. Hansen
President
American Cancer Society Cancer Action Network (ACS CAN)