GAO doesn't fault healthcare reform waivers

By Julian Pecquet - 06/14/11 01:29 PM ET

A much anticipated audit of the waivers to Democrats' healthcare reform law landed with a whimper on Tuesday despite the GOP's hopes that it would further embarrass the administration.

House Republicans had required the Government Accountability Office audit as part of the stopgap spending bill enacted in April. The administration has been criticized for approving more than 1,000 temporary waivers to the law's requirement that plans spend at least $750,000 on patient care per year before cutting off their benefits.

The GAO said the Department of Health and Human Services had received 1,415 waiver applications, some of them covering multiple plans, as of April 25. It approved 1,347 — more than 95 percent — of the applications in their entirety, while rejecting 25 in part and 40 in whole.

"We found that [the Center for Consumer Information and Insurance Oversight] granted waivers mostly for applications that projected the annual limit restriction would result in a significant premium increase of more than 10 percent, in addition to a significant decrease in access to benefits," the report said. "Conversely, most of the denied applications projected a premium increase of 6 percent or less."

Democrats immediately embraced the audit.

"The GAO report finds that (the administration) is implementing this provision – and the temporary waiver provisions – in a fair and unbiased manner to ensure a smooth transition until the full array of reforms are in place," Energy and Commerce ranking member Henry Waxman (D-Calif.) said in a statement. "The GAO report confirms that the Republican attacks on (the administration's) implementation have no basis in fact."

Meanwhile, the conservative group Let Freedom Ring focused its criticism on the rejected applications.

"We are a nation of equal protection under the law, and either every American should be exempt from ObamaCare's harm or none should," President Colin Hanna said in a statement. "But the Obama Administration has ridiculously decided to leave 150,000 Americans in the dust while many of its union and San Francisco allies skate on by with waivers, a reality that reeks of crony capitalism."

About 3 million people are affected by the waivers, while 153,000 people are in plans that were denied waivers.

The administration used its response to the audit to once again argue that the process has been transparent, despite lingering allegations of cronyism.

"The annual limit waiver process has been carried out in a way that reflects a commitment to transparency and responsible implementation," wrote HHS Assistant Secretary for Legislation Jim Esquea.

This post was updated at 3:50 p.m.