From the February 2011 issue of Treasury & Risk magazine

Tweaking Health Reform

Large employers are steering clear of Republican efforts to repeal the Patient Protection and Affordable Care Act (PPACA). Instead, they are focusing on surgically altering individual Department of Health and Human Services rule-makings where bureaucrat interpretations of broadly worded healthcare reform provisions could negatively affect company health plans this year. To the extent that new Republican chairs of congressional committees hold oversight hearings to shine a light on implementation imbroglios, business groups welcome that attention.

"The way the law has been implemented has been a mixed picture," says Paul Dennett, senior vice president of health care reform at the American Benefits Council. For example, he cites rules denying grandfathered status to plans that made cost-sharing changes after March 2010. Grandfathered plans can ignore some of PPACA's requirements.

Another current hot spot is how regulations define preventive services, which must be provided to plan members without cost sharing in 2011, says Gretchen Young, senior vice president of healthcare policy at the ERISA Industry Committee.

The interim final rule published last July imposes mandates based on recommendations from the U.S. Preventive Services Task Force, which focuses on services physicians should provide, Young says. "These are ambiguous or unclear with respect to their application to health plans," she says. Nor is it clear whether employers can apply reasonable medical management techniques and cost-sharing to out-of-network preventive services.

Dennett and Steve Wojcik, vice president of public policy at the National Business Group on Health, agree that federal agencies have shown some welcome flexibility, even prior to the midterm elections. Dennett points to the HHS' waiving some PPACA requirements for so-called mini-med plans, low-cost, low-benefit insurance offered mostly to low-wage employees. Without the waivers, companies would have eliminated those plans this year and employees would have lost their health coverage, he says.

Big business groups see a number of positive aspects to healthcare reform, which accounts for their "rejigger, not repeal" approach. PPACA's provision of $5 billion to help companies fund health insurance for early retirees who are too young for Medicare is one of a number of pluses.

Still, companies evince a smoldering desire to obtain legislative changes to a couple of provisions that don't kick in for some years, such as PPACA's requirement that starting in 2018, companies pay an excise tax on what have been referred to as "Cadillac" health plans.

 

For more on employers' reaction to healthcare reform, see Most Companies Plan to Continue Health Coverage.

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