By Jason Millman - 03/11/11 11:00 AM EST
The 1,000-plus waivers granted by the Obama administration to a portion of the healthcare reform law have become a political liability for the White House.
Republicans are accusing the administration of rewarding Democratic allies in the labor movement with the waivers, which exempt recipients from the reform law’s annual coverage limits.
“The fact that over 1,000 waivers have been granted is a tacit admission that the healthcare law is fundamentally flawed,” said House Energy and Commerce Committee Chairman Fred Upton (R-Mich.), one of two House chairmen using their oversight powers to probe the waivers.
The drumbeat of GOP criticism has grown louder as the waiver awards have increased. Approval of waiver requests has jumped from 222 to almost 730 in December, and another 300 have been approved since then.
The Department of Health and Human Services (HHS), which is in charge of implementing the healthcare reform law, says waiver requests have slowed during the past two months, but that hasn’t quelled the GOP outcry.
Rep. Mike Rogers (R-Mich.) says the waivers should be made available to anyone. On Thursday he introduced legislation that would let individuals apply for exemptions to any part of the healthcare law.
“If the SEIU gets a waiver and McDonald’s gets a waiver,” Rogers said, “shouldn’t the average person who’s impacted by this get a waiver, too?”
The administration and Democratic lawmakers have rejected the Republican criticism, pointing out that the law provides HHS Secretary Kathleen Sebelius the ability to offer the waivers. Democrats also deny the charges of favoritism in the process, noting that that a large number of businesses — and not just unions — have received the exemption.
The one-year waivers are typically granted to organizations that offer limited health insurance, known as “mini-med plans,” that sometimes provide as little as $2,000 in annual coverage. The waivers are meant as a stopgap measure until new state-run health insurance exchanges open up, when the mini-med insurance plans will be phased out, HHS says.
“We don’t want to take away people’s health insurance before they have some realistic other choices,” Sebelius said in an interview with The Hill earlier this year.
The law requires a phase-out of annual dollar limits on benefits, with a minimum limit of $750,000 in 2011. The limits gradually rise until they are completely eliminated in 2014.
The administration touts the waivers as evidence that they are showing flexibility in the implementation of the reform law. On Thursday, HHS detailed plans to let states opt out of the law to create their own reforms, and earlier this week, the department gave Maine insurers an exemption from a reform provision that restricts administrative spending.
The attempts to provide flexibility aren’t winning over Republican critics.
“Lawsuits, exemptions and exceptions are not healthcare reform,” House Ways and Means Republicans said Thursday.
The GOP scrutiny has forced Democrats into the politically awkward position of defending health plans that the law aims to eliminate. They say even the worst insurance is still better than no insurance at all.
“We’re saying until we get to the full implementation of the Affordable Care Act, we’re going to let these go, because the other option is nothing,” said Rep. Jan Schakowsky (D-Ill.).
The leader of Families USA, one of the White House’s strongest healthcare allies, isn’t worried about the rising number of waivers. As long as the administration is clear on waiver standards and decisions, said Families USA executive director Ron Pollack, it can continue to make the case for them.
“What’s ironic is if there were disruption [in the insurance market] … the Republicans would complain that the legislation is too rigid,” Pollack said.
But House Republicans with significant oversight powers contend the process hasn’t been transparent. The House Committee on Oversight and Government Reform this week accused HHS of stalling the committee’s probe into why dozens of organizations have been denied waivers.
“The current lack of transparency lends credence to the perception that bureaucrats are picking winners and losers in a politicized environment where the winners are favored constituencies of the administration,” the Oversight panel wrote.
For its part, HHS says it already provided most of the documents to the Energy and Commerce Committee, which launched its own waiver investigation in January.
The waivers cover approximately 2.6 million people, or less than 2 percent of privately insured individuals, according to HHS.
For a complete list of waivers click here.