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New HHS policy could diminish protections for people who depend on quality, affordable health insurance.

On Oct. 22, the U.S. Department of Health and Human Services released new guidance spelling out how states can win approval to waive various Affordable Care Act requirements. This arcane new policy could seriously impact protections for patients with pre-existing conditions, including people with bleeding disorders.

The ACA, by its terms, allows states to waive some – but not all – of the law’s requirements. States cannot waive some of the ACA’s bedrock consumer protections, such as the law’s ban on pre-existing condition exclusions, or the provision that says insurers can’t set premiums based on a customer’s health status. Other ACA provisions are waivable, but only so long as the state meets certain standards (“guardrails”) and obtains federal approval. Existing law says a state waiver proposal will be approved only if the state shows that its proposed alternative would cover as many people as the ACA, with equally comprehensive and affordable coverage, at no greater cost to the federal government.

The new guidance radically weakens these guardrails, under the banner of enhancing “state flexibility.” Under the new guidance, when HHS evaluates waiver proposals, the agency will no longer consider what coverage is actually purchased, but whether customers have “access to” comprehensive coverage – even if they don’t enroll in it. HHS will no longer weigh whether a state’s waiver proposal protects (or disadvantages) vulnerable populations, like people with chronic health conditions; instead HHS will focus on the overall number of people who get insurance. States will be able to count – even promote – enrollment in short-term plans and other low-quality coverage (thereby worsening the risk pool for comprehensive insurance and increasing costs for people who rely on such insurance).

Many health policy experts agree that the new HHS guidance represents an end-run around ACA protections and, as such, may face legal challenge. The new guidance will create wider differences between states with respect to the regulation of their insurance markets and the extent of protection for people with pre-existing conditions. HFA joined with other patient groups in criticizing the guidance, and will continue advocating on this critical issue.

Trump Administration proposes rule change that could shift 10 million workers into individual insurance market and away from employer-sponsored insurance.

A federal rule proposal released on Oct. 29 would expand the use of health reimbursement accounts. The rule would allow employers to choose whether to offer HRAs – sums of money that employees could use to purchase individual health insurance plans – in place of traditional group coverage.

The Administration (HHS together with the Departments of Treasury and Labor) says that the proposed rule would expand the health insurance options available to workers, particularly those who work for small- to mid-sized employers. The Administration projects that over 10 million workers would shift from employer-sponsored plans to the individual insurance market over the next decade.

From an initial reading, it appears that the proposed HRA rule could promote greater portability of health insurance across job changes – a net positive. But the proposed rule also gives rise to some serious concerns:

  • Would employers use HRAs as a mechanism to shift “sicker,” costlier employees out of group coverage (“adverse selection”)?
  • What does it mean to shift large numbers of people into the individual insurance market at a time when action by the current Administration is reducing ACA protections and destabilizing that market?
  • Would HRA contributions rise to keep pace with increases in the cost of insurance?
  • Do employees want “more choice,” per se – or do they want high value insurance that offers quality, affordable health coverage and care?

HFA (along with other patient groups and health policy experts) will continue to study this very-recently issued rule proposal over the coming weeks. The comment period runs through December 28, 2018.

Quick hits:

  • Election Day is Nov. 6. Please be sure to vote! This year’s elections will have a major impact on patient protections, Medicaid, Medicare, and health care in general. Use HFA’s handy resource to find your polling place and see who’s on the ballot in your area. Want to learn more about your candidates’ positions on healthcare and other issues important to you? The non-partisan League of Women Voters allows you to get information on your specific candidates and issues here.
  • Open enrollment for 2019 is upon us! This is the period when you can enroll in a new health plan (or choose to stay with your existing insurance) for the coming year. For helpful tips about this year’s Open Enrollment, please see our Dear Addy posts here and here.
  • HFA joined with 11 other national patient advocacy organizations to file an amicus brief (“friend of the court”) in a lawsuit challenging the Administration’s rules expanding the availability of skimpy short-term health plans. The amicus brief argues that the new rules will destabilize the insurance market, hurting people with pre-existing conditions. Read more here.
  • The Administration released an advance notice of proposed rulemaking on reimbursement for Part B prescription drugs on Oct. 25. Under this proposed framework, HHS would experiment with linking Medicare reimbursement for certain doctor-administered drugs to what other countries pay for those same drugs. HHS argues that this payment model will bring down drug spending. Some policy experts question that claim; almost all expect that the proposal will be challenged.
  • President Trump signed a bipartisan opioid bill into law on Oct. 24, 2018. The new law will, among other things: allow Medicaid to pay for addiction treatment at certain inpatient facilities; expand the FDA’s authority over drug packaging and labeling; and expand access to substance use disorder treatments.
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