Healthcare Friday

Fast food fallout: After spending Thursday responding to a Wall Street Journal story about McDonald's threat to abandon coverage for some 30,000 hourly employees, the Department of Health and Human Services announced that it intends to specifically address the issue of mini-med plans in "forthcoming regulations." 

The department points out that it has created an "expedited process" for plans to apply for a waiver from the health reform law's requirement establishing minimum annual limits "where such limits would result in decreased access or increased premiums;" HHS has already approved "dozens" of these waiver requests.

Furthermore, HHS suggests, waivers from the law's medical loss ratio requirements - the minimum portion of premiums insurers must spend on medical care - are also on the horizon even if the National Association of Insurance Commissioners must finish its work defining the ratio first.

"Although the NAIC is close to completing its work, we understand that some employers must soon make decisions regarding coverage options for 2011," Jay Angoff, director of HHS' Office of Consumer Information and Insurance Oversight, said in a statement. "As such, we fully intend to exercise (the secretary's) discretion under the new law to address the special circumstances of mini-med plans in the medical loss ratio calculations. According to the Affordable Care Act, medical loss ratio 'methodologies shall be designed to take into account the special circumstance of smaller plans, different types of plans, and newer plans.' We recognize that mini-med plans are often characterized by a relatively high expense structure relative to the lower premiums charged for these types of policies. We intend to address these and other special circumstances in forthcoming regulations."


California paves the way: California opted to move ahead with its own health insurance exchange Thursday after President Obama personally urged Gov. Arnold Schwarzenegger to do so, reports the Sacramento Bee. http://bit.ly/cTbcbd 

"The two bills signed late Thursday establish the California Health Benefit Exchange and an independent, five-member oversight board appointed by the governor and the Legislature that will be tasked with defining how the exchange will operate," the Bee explains. Anthem Blue Cross, the state's largest for-profit insurer, and the California Chamber of Commerce lobbied hard against the measure.

California is being touted as the first state to vote to create its own exchange under the healthcare reform law. However Utah and Massachusetts already had their own exchanges prior to the law's enactment in March. 

The California decision comes as the Department of Health and Human Services on Thursday announced the recipients of $49 million in grants to help states begin to look at the feasibility of operating their own exchanges versus letting HHS take over in 2014. Joel Ario, director of the Office of Health Insurance Exchanges at HHS, said 2011 would be "critical legislative year" for states to enact bills creating their exchanges. http://bit.ly/cGd6Zs


HHS to unveil new health plan information: Consumers will be able to access more information than ever before on HHS' insurance Web portal starting later today, HHS Secretary Kathleen Sebelius announced Thursday. The new information to be made available at HealthCare.gov includes: monthly premium price estimates; the percentage of people denied coverage by a particular plan; and the percentage of people who pay more than the base premium.

Sebelius outlines the new information in a post on the White House blog. http://bit.ly/9VLyqo


Now for the bad news: Following Sebelius' Sept. 9 letter to insurers warning that "there will be zero tolerance" for the "unjustified rate increases" some of them are proposing for 2011, Energy and Commerce Republicans are demanding that she provide "all written material she has proving that the premium increases are unjustified or not actuarially sound, and to provide all documents or evidence in your possession showing that state insurance commissioners are unable or unwilling to protect consumers." 

"We fear that your letter is an effort to intimidate those who reveal the negative consequences of the law and an attempt to block actuarially sound premium increases, which would put all consumers at risk," Reps. Joe Barton (Texas), John Shimkus (Ill.) and Michael Burgess (Texas) write in a letter to the secretary. http://bit.ly/aGUIx2


Hospital asks outlined: The American Hospital Association outlines its legislative agenda for the lame-duck session in a "quick reference guide" for members. These include higher Medicare and Medicaid payments and changes to federal health information technology incentives for multi-campus systems. 


Medicare DME saga continues: Medicare's bidding program for durable medical equipment will fail, 167 leading experts on auctions and competitive bidding systems tell Congress in a letter to Ways and Means Chair Pete Stark (D-Calif.). The program is due to take effect on Jan. 1 in nine of the country's largest metropolitan areas. http://bit.ly/bcm63d

The experts do not oppose the concept of using a competitive bidding system to set Medicare prices, according to the American Association for Homecare.  But they're concerned that "the bidding program designed by CMS has several flaws that will prevent it from achieving the objectives of low cost and high quality."



Doctor shortage looms: So says a new report from the Association of American Medical Colleges, which estimates that the shortage of physicians beginning in 2015 will be 50 percent worse than originally anticipated prior to healthcare reform. At fault: The 32 million extra people who will have coverage, coupled with 36 million more elderly Americans joining the Medicare rolls. http://bit.ly/c8RY2i


AHIP tracks state implementation: America's Health Insurance Plans has created a chart and map tracking state implementation of the health reform provision that prohibits pre-existing condition exclusions for children.

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