By Benjamin Goad - 05/20/13 04:24 PM EDT
The Obama administration is moving forward with a pair of major Affordable Care Act (ACA) regulations, as Republicans move to link the landmark law to the ongoing scandal at the Internal Revenue Service.
Final rules written to extend access to insurance for people with pre-existing conditions and set maximum profit margins for certain providers are set to be published this week in the Federal Register.
The ACA also created the stopgap Pre-Existing Condition Insurance Plan (PCIP) program, meant to boost access until that provision of the law takes effect.
“As a temporary bridge to the provisions that go into effect beginning in 2014, the PCIP program was designed to provide coverage to eligible individuals who have been locked out of the insurance market due to their health status,” according to the Department of Health and Human Services.
To help pay for the temporary program, $5 billion was set aside. More than 135,000 otherwise uninsured patients were enrolled, with an average annual cost just over $32,000.
Costs have been higher than projected, forcing the administration to freeze enrollment earlier this year. The new rule, to be published this week, sets new, lower reimbursement to healthcare providers participating in the program.
The regulations also prevent the providers from recouping the difference through “balance billing” of the patients, according to the rule.
The effort is meant to make the most of the remaining balance of the initial allotment. The rule is considered economically significant in that it carries an annual economic impact of more than $100 million.
The new rates take effect in mid-January, though interested parties will have 60 days to comment.
The administration is also finalizing a rule capping profit margins for certain health insurance plans and prescription drug benefit programs.
The measure would implement 85 percent “medical loss ratio” requirements on Medicare Advantage plans and the Medicare Prescription Drug Benefit Program. In other words, plans that deliver services under those plans must spend at least 85 percent of their premiums on “clinical services, prescription drugs, quality improving activities, and direct benefits to beneficiaries,” according to the proposal.
Overhead expenses and profits would be capped at 15 percent.
Plan sponsors who fail to meet the requirements for more than three straight years would be subject to “enrollment sanctions,” and those who miss the mark for five consecutive years would be terminated from the federal programs. Also considered economically significant, that rule is set be published this week but will not take effect until January.
The actions are the latest steps in the administration’s development of scores of rules required by the bill embraced by supporters and derided by opponents as “ObamaCare.”
Republicans have, in recent weeks, ramped up their criticism of the law as they set their sights on the 2014 elections. Several GOP lawmakers have sought to link the troubles at the IRS, which was found to have targeted conservative groups, with the healthcare law.
The agency is responsible for drafting many of the ACA’s rules.
“The IRS has a role to play in the implementation of ObamaCare, which is another reason why, if we have the opportunity to do it, we ought to pull it out root and branch,” Senate Minority Leader Mitch McConnell (R-Ky.) said Sunday on "Meet the Press."
Describing the law as the worst piece of legislation passed in modern times, McConnell said he believed the Affordable Care Act would damage Democrats’ chances at the polls more than the spate of recent scandals now hanging over the administration.
“If I were predicting what's likely to be the biggest issue in the 2014 election, I think it would be ObamaCare,” the Kentucky Republican said.