Department of Health and Human Services

At this writing, the prospects for success of the latest Republican effort to replace the Affordable Care Act appear bleak—but the Graham-Cassidy bill on which the GOP has pinned its last-ditch hopes highlights a major political and policy flashpoint in the fight to repeal, replace, or repair the law: the degree to which states should be free to innovate and experiment by adopting non-standard health insurance product designs in their individual and small group markets. Under current law, there is little flexibility. Proposals abound to change this, but to do so invites consequences with which lawmakers must be prepared to deal—involving complex economic and actuarial issues and fundamental questions regarding the role of the federal government and the states in health care.

This post addresses these issues.

Continue Reading Fractal Geometry, Actuarial Risk, and §1332 Waivers—The Role of the States in Reforming Health Care

On June 10, the Departments of Treasury, Labor, and Health and Human Services (The “Departments”) issued a set of proposed regulations dealing with expatriate health plans, excepted benefits, lifetime and annual limits, and short-term, limited-duration insurance. While the media initially focused on the short-term, limited-duration insurance, the provisions in the proposed regulations addressing hospital and fixed indemnity, disease-specific, and supplemental polices merit attention. These polices generally seek to avoid application of the Affordable Care Act’s (ACA) insurance market reforms and other substantive requirements by qualifying as “excepted benefits.” For manufacturers and sellers of excepted benefit products, the challenge is to create a product that will gain traction in the market—i.e., has the requisite “sizzle”—while at the same time avoiding being treated as a “group health plan” that fails to qualify as “excepted.” The proposed rules, if adopted as final, will make this challenge marginally if not significantly more difficult.

In future posts, we will turn our attention to expatriate health plans, lifetime and annual limits, and short-term, limited-duration insurance. This post examines the provisions of the proposed regulations’ treatment of excepted benefits, with a particular focus on accident, hospital and fixed indemnity, disease-specific, and supplemental products and policies.

Continue Reading Hospital and Fixed Indemnity and Disease-Specific Policies in the Cross Hairs: Tri-Agency Proposed Rule Portends Some Disruption

Written by Alden J. Bianchi

In a previous post, we described an Affordable Care Act compliance strategy—referred to commercially as a “minimum value plan” or “MVP”—that involves an offer of group health plan coverage that, while similar in most respects to traditional major medical coverage, carves out inpatient hospital services. A subsequent post warned of rumors that regulators were less than thrilled with these arrangements, and that in all likelihood the Treasury Department/IRS and the Department of Health and Human Services (the “Departments”) would take steps to require that plans purporting to provide minimum value cover such services.

On November 3, 2014, the Departments announced their intent to retroactively revise their respective minimum value regulations so that plans that fail to provide substantial coverage for in-patient hospitalization services (or for physician services) will not qualify as minimum value. The Departments’ announcement also included some limited transition relief, and imposed some additional notice requirements.

Continue Reading The Affordable Care Act—Countdown to Compliance for Employers, Week 7: IRS Puts the Kibosh on Health Plans that Fail to Cover Hospital or Physician Services

Written by Alden J. Bianchi

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) ushered in broad national standards aimed at improving the efficiency and effectiveness of the U.S. health care system. Referred to generically as “administrative simplification,” these rules govern the areas of privacy and security of health information, electronic health care transactions and code sets, and unique health identifiers. In the years that followed, the Department of Health and Human Services (HHS) issued comprehensive rules in each of these areas. A summary of these rules is available here.

Continue Reading The Affordable Care Act—Countdown to Compliance for Employers, Week 21: Self-Funded Group Health Plans, the Affordable Care Act and National Health Plan Identifier Numbers (HPIDs)