Download The Alphabet Soup of The Affordable Care Act

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The Alphabet Soup of the ACA
Elizabeth A. McGown, J.D.
Senior Vice President, General Counsel
Chamberlin Edmonds & Associates, Inc.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
www.chamberlinedmonds.com
PPACA – Affordable Care Act
The landmark health reform legislation provided in The Patient
Protection and Affordable Care Act of 2010 (PPACA), as
Amended by the Health Care and Education Reconciliation
Act of 2010, will have a broad and sweeping impact on
hospitals and health systems.
Signed by President Obama on March 23, 2010, PPACA is
now known as the Affordable Care Act.
This presentation is focused on certain key provisions in the
Act that will directly or indirectly impact hospitals and health
systems.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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PPACA – Affordable Care Act (continued)
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Amends the following Acts:
– The Public Health Service Act.
– The Fair Labor Standard Act.
– The Social Security Act.
– The Internal Revenue Code.
– The Employee Retirement Income Security Act of 1974.
– The Deficit Reduction Act of 2005.
In the months since ACA was enacted legions of lawyers, consultants
and other advisors have inundated hospital, insurance and other health
care providers with information analysis and advice about the new health
care reform law. Rather than regurgitate the details of the law, this
presentation attempts to corral related provisions and suggest proactive
planning and evaluation that can be done by entities to take advantage
of the opportunities of the new law and be prepared for the general
direction of travel.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
ACA’s Strategic Focus
The ACA at Section 3011 directs the Secretary of HHS to establish
a national strategy. The initial 2011 Plan delivered to Congress in
March 2011 articulates the following priorities:
Making care safer by reducing harm caused in the delivery of care.
Ensuring that each person and family are engaged as partners in their care.
Promoting effective communication and coordination of care.
Promoting the most effective prevention and treatment practices for the
leading causes of mortality, starting with cardiovascular disease.
Working with communities to promote wide use of best practices to enable
healthy living.
Making quality care more affordable for individuals, families, employers, and
governments by developing and spreading new health care delivery models.
These priorities can only be achieved with the active engagement of
clinicians, patients, provider
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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The Heart of the Affordable Care Act
Insurance Reforms
Reimbursement and Eligibility
Employer Responsibilities
Health Information Technology (HIT)
Delivery System Realignment
Fraud and Abuse
Tax Exempt Status
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Insurance Reforms
The ACA significantly reforms the health insurance market by
establishing new requirements related to underwriting, scope of
benefits and rating requirements.
Provisions include:
Medical Loss Ratio (MLR) requirements - requires health
plans to report the proportion of premium dollars spent on clinical
services, quality, and other costs and provide rebates to
consumers if the share of the premium spent on clinical services
and quality is less than 85% for plans in the large group market
and 80% for plans in the individual and small group markets.
Implementation: Requirement to report medical loss ratio
effective for 2010; requirement to provide rebates effective
beginning January 1, 2011.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Insurance Reforms (continued)
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Coverage of Young Adults - expands coverage under a
parent’s health insurance to include dependents up to age 26 for
all individual and group policies. Implementation: September
23, 2010. [As of May 2011 over 600,000 young adults have
enrolled for coverage under these provisions.]
Consumer Protections in Insurance - prohibits individual and
group health plans from:
- rescinding coverage except in cases of fraud
- denying children (under age 19) coverage based on pre-existing
medical conditions or including in policies pre-existing condition
exclusions for children
- restricts annual limits on the dollar value of coverage (and
eliminates annual limits in 2014)
- placing lifetime limits on the dollar value of coverage
Implementation: September 23, 2010
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
Insurance Reforms (continued)
Insurance Plan Appeals Process requires new health plans to
implement an effective process for allowing consumers to
appeal health plan decisions and requires new plans to
establish an external review process. Implementation:
September 23, 2010.
Grandfathered Plans – Grandfathered plans are exempt
from certain requirements so long as employers do not
significantly lower their premium contributions to employee
plans and plans do not increase people's cost-sharing
requirements beyond certain limits or reduce benefits. For
insurance plans that lose “grandfathered “ status, health plans
must provide emergency services coverage without the need for
prior authorization and the cost sharing must be the same for
out-of-network and in-network.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Insurance Reforms (continued)
Review of Health Plan Premium Increases requires the federal
government to create a process, in conjunction with states, where
insurers have to justify unreasonable premium increases. Provides
grants to states for reviewing premium increases. Implementation:
Plan year 2010. Starting September 1, 2011 rate increases higher
than 10 percent will be reviewed by states with rate review procedures
meeting certain standards and by CMS for states that do not have such
standards. CMS will conduct rate review covering both the individual
and small group markets in Alabama, Arizona, Idaho, Louisiana,
Missouri, Montana and Wyoming. It will conduct small-group market
reviews in Iowa, Pennsylvania and Virginia.
Guaranteed Availability of Insurance requires guarantee issue and
renewability of health insurance regardless of health status and allows
rating variation based only on age (limited to a 3 to 1 ratio), geographic
area, family composition, and tobacco use (limited to 1.5. to 1 ratio) in
the individual and the small group market and the Exchanges.
Implementation: January 1, 2014.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Insurance Reforms – New initiatives
Health Insurance Exchanges creates state-based American Health
Benefit Exchanges and Small Business Health Options Program
(SHOP) Exchanges, administered by a governmental agency or nonprofit organization, through which individuals and small businesses with
up to 100 employees can purchase qualified coverage. Creates a
mechanism for organizing the health insurance marketplace to help
consumers and small businesses shop for coverage in a way that
permits easy comparison of available plan options based on price,
benefits and services, and quality. Exchanges will have a single form
for applying for health programs, including coverage through the
Exchanges and Medicaid and CHIP programs. Implementation:
January 1, 2014. First Open Enrollment – Fall 2013. [Federal
Regulations issued July 11, 2011 give States significant flexibility in
structuring the Exchanges]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Insurance Reforms – New initiatives
High Risk Pools – The creation by states or the Secretary (HHS) of
temporary high risk pools for people who have been uninsured for at
least 6 months and have been denied coverage due to pre existing
conditions. The federal high risk plan is called the Pre-Existing
Condition Insurance Plan (PCIP). The federal plan is available in 23
States and in DC. Implementation: Enrollment into the federal
plan began July 1, 2010; implementation dates for the stateoperated plans vary.
In 2010, people enrolled in the federally-administered PCIP program
were offered one plan. Beginning in 2011, enrollees in the federally
administered PCIP program are able to choose between three plan
options: the Standard Plan ($2,000 medical deductible & $500 drug
deductible), the Extended Plan ($1,000 medical deductible & $250
drug deductible) and the Health Savings Account eligible plan ($2,500
deductible eligible for favorable tax treatment when used with a
HSA). In addition, families will be able to enroll their eligible children
in PCIP at child-only rates.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Insurance Reforms
As quality, cost effectiveness and efficiency will be critical in the
decisions of health plans and health care providers to contract
with particular entities, evaluate current data collection methods
and where appropriate upgrade systems that track quality and
efficiency.
Prepare now for a future that will include Accountable Care
Organizations and a movement away from fee-for-service
toward bundled payments and value-based reimbursement.
As all players in the health care arena will be chasing quality
and cost effectiveness, insurers may gravitate to a more select
group of providers in order to better manage health care costs
and satisfy the new MLR requirements.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Reimbursement and Eligibility
Independent Payment Advisory Board (IPAB) – establishes a 15
member board with significant authority with respect to Medicare
payment rates. Beginning in 2014, in any year in which the Medicare
per capita growth rate exceeded a target growth rate, the IPAB would
be required to recommend Medicare spending reductions. The
recommendations would become law unless Congress passed an
alternative proposal that achieved the same level of budgetary
savings. Subject to some limitations—hospitals, for example, would
be exempt until 2020—the IPAB could recommend spending
reductions affecting Medicare providers and suppliers, as well as
Medicare Advantage and Prescription Drug Plans. Administrative
funding available October 1, 2011 [Doctors, drug companies and
some patients' groups are worried IPAB will recommend reductions in
Medicare payments. There is Congressional action afoot to repeal
this initiative. Some lawmakers believe the IPAB will have to much
power.]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Reimbursement and Eligibility (continued)
Medicare Value-Based Purchasing establishes a hospital valuebased purchasing program in Medicare to pay hospitals based on
performance on quality measures and requires plans to be developed
to implement value-based purchasing programs for skilled nursing
facilities, home health agencies, and ambulatory surgical centers.
Implementation: October 1, 2012.
Changes in Medicare Provider Rates – Reduced annual market
basket updates for inpatient and outpatient hospital services, long-term
care hospitals, inpatient rehabilitation facilities, and psychiatric
hospitals and units and adjusts payments for productivity.
Implementation: Beginning fiscal year 2010; productivity
adjustments added to market basket update in 2012.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Reimbursement and Eligibility (continued)
Medicare Advantage Incentive Payment – High quality Medicare
Advantage health plans will be eligible for incentive payments.
Implementation: 2012 (These Plans will be looking for providers
who can demonstrate quality standards). [NOTE: Medicare
Advantage plans will also be covered by the 85% MLR standard.]
Medicare Bundled Payment Pilot Program establishes a national
Medicare pilot program to develop and evaluate making bundled
payments for acute, inpatient hospital services, physician services,
outpatient hospital services, and post-acute care services for an
episode of care. Implementation: January 1, 2013.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Reimbursement and Eligibility (continued)
Hospital Readmissions Reduction Program - Hospitals with
readmission rates that exceed their expected readmission rate will have
their Medicare inpatient payments reduced by an amount approximately
equal to the dollar value of the payments made for the excessive
number of readmissions. Initially the readmission payment penalty
policy will be based on readmissions related to three conditions: heart
failure, heart attack, and pneumonia. Implementation: October 2013
Optional Medicaid Coverage – States may begin to take advantage of
Medicaid changes to cover childless individuals up to 133% of FPL
(additional federal funding for this group is not available until 2014 when
coverage of this group is mandatory). Implementation: Optional after
April 1, 2010. [To date, Connecticut, Washington, Minnesota and the
District of Columbia have opted to expand Medicaid to childless adults
previously covered by 100% state funds.]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Reimbursement and Eligibility (continued)
Medicaid Payments for Hospital-Acquired Infections - prohibits
federal payments to states for Medicaid services related to certain
hospital-acquired infections and “reasonably preventable” conditions.
Implementation: July 1, 2011. [Federal regulations governing this
provision were published in June 2011 and most state Medicaid
programs have issued guidelines. The minimum Medicaid list of
what is preventable mirrors the Medicare list – in place since 2008.]
Expanded Medicaid Coverage - expands Medicaid to all individuals
not eligible for Medicare under age 65 (children, pregnant women,
parents, and adults without dependent children) with incomes up to
133% FPL and provides enhanced federal matching payments for
new eligibles. Medicaid enrollment is projected to increase by 15.9
million by 2019. About 95% of all new spending would be by the
federal government. Spending in 2014 is expected to be relatively
small, particularly for States because enrollment is being phased‐in
and the federal matching rate for new eligibles is 100%.
Implementation: January 1, 2014.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Reimbursement and Eligibility
Assess Medicare quality measurement reporting and
performance.
Develop reporting and performance improvement plans in
advance of the implementation of a Medicare value-based
purchasing program.
Have a solid reporting system that can be tweaked as regulatory
guidance becomes available.
Evaluate policies and procedures to minimize readmissions.
Compare readmission rates to peer benchmarks. Model
reimbursement implications of readmission rates if Medicare
reimbursement methodologies change to bundled payments or
value based methodologies. Revise policies and procedures as
necessary. [Federal Regulations are anticipated in August 2011]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Reimbursement and Eligibility (continued)
Evaluate hospital acquired condition statistics. Revise policies
and procedures to minimize these occurrences.
If the hospital systems includes other provider entities or has
relationships with other provider types (e.g. Skilled nursing
facilities, Ambulatory Surgery Centers) evaluate their quality
reporting systems and integrate their quality measurement
systems into the hospital or health system reporting capacity.
If the hospital employs physicians, evaluate the quality measures
utilized and assure that the reporting system is compatible with
the hospital system.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Reimbursement and Eligibility (continued)
In anticipation of additional Medicaid eligibles – certainly by
2014, evaluate Emergency Department capacity and
specialized services (e.g. mental health) that may be more
prevalent among the newly eligible childless adult population.
In anticipation of newly Medicaid eligible influx, evaluate intake
and enrollment capacities.
As baby boomers reach retirement age, intake and enrollment
capacities will need to respond to additional individuals who
maybe eligible for both Medicare and Medicaid.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Health Information Technology (HIT)
There are more than 12 sections of the ACA that reference various
aspects of health information technology infrastructure. The criticality of
HIT cannot be understated. HIT will support the coordination of care,
quality measurement and reporting and new payment models. Financial
incentives are available under the 2009 Health Information Technology for
Economic and Clinical Health (HITECH) Act.
The Medicare Electronic Health Record (EHR) or Electronic Medical Record
Incentive Program of the HITECH Act will provide incentive payments to eligible
professionals, eligible hospitals, and critical access hospitals (CAHs)that
demonstrate “meaningful use” of certified EHR technology.
– Participation can begin as early as 2011.
– Eligible professionals can receive up to $44,000 over five years under the
Medicare EHR Incentive Program.
– To get the maximum incentive payment, Medicare eligible professionals
must begin participation by 2012.
– Incentive payments for eligible hospitals and CAHs may begin as early as
2011 and are based on a number of factors, beginning with a $2 million
base payment.
– For 2015 and later, Medicare eligible professionals, eligible hospitals, and
CAHs that do not successfully demonstrate meaningful use will have a
payment adjustment in their Medicare reimbursement.
– There are also incentive funds available through State Medicaid programs.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – HIT
Evaluate capacity of the hospital's HIT infrastructure to support
analytics, quality measures, reporting and ability to integrate
with other providers.
Assure that Electronic Health Record (EHR) implementation is
proceeding in both the acute and ambulatory care settings.
Assure that the EHR implementation complies with the
“meaningful use” regulations promulgated in July 2010.
Take necessary steps to access incentive payments for EHR
implementation.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Employer Responsibilities
Hospitals and health systems besides serving the health care
needs of the community are significant employers. As such,
hospitals and health systems must be prepared to respond to
the changes impacting employers which include:
Implement Consumer Protections/ Insurance Reforms including
creations of an appeals process and enrollee communications
regarding young adult enrollment.
Reinsurance Program for Retiree Coverage creates a temporary
reinsurance program for employers providing health insurance
coverage to retirees over age 55 who are not eligible for Medicare.
Implementation: Current through January 1, 2014.
[In April 2011, CMS closed enrollment in this popular program after
1,300 health plan sponsors signed up exhausting the $1.8B in
available funding.]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Employer Responsibilities
Closing the Medicare Drug Coverage Gap requires pharmaceutical
manufacturers to provide a 50% discount on brand-name
prescriptions filled in the Medicare Part D coverage gap beginning in
2011 and begins phasing-in federal subsidies for generic
prescriptions filled in the Medicare Part D coverage gap.
Implementation: January 1, 2011.
[Through May 2011, 271,000 people have used the discounts to save
an average of $613 for a total of $166 million. These savings will
continue to grow. Most people who reach the donut hole do so later
in the year. The savings for U.S. seniors who participate in the
Medicare Part D prescription drug plan may extend far beyond the
cost of medications, a new study indicates "That effect of Part D was
mostly explained by reduced spending on hospital and shorter-term
nursing home stays that follow hospitalization," said Dr. J. Michael
McWilliams in the July 2011 issue of the Journal of the American
Medical Association.”]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Employer Responsibilities
Analyze whether to maintain health plan status as a grandfathered
plan and what impact that decision will have on the employer’s
future ability to make changes to plan design, change insurance
carriers or implement new cost sharing features (e.g. co-payments,
coinsurance, out-of-pocket maximums and premium increases).
Update plan documents and make required plan participant
disclosures.
If the system provides retiree benefits, participate in the early
Retiree Reinsurance Program. As appropriate engage vendors to
assist with claiming process to HHS.
As the “doughnut hole” in Medicare Part D begins to close,
evaluate whether to continue to maintain a retiree prescription drug
program.
Amend health care flexible spending account plans and notify
employees of new limitations.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Delivery System Realignment
The Act imposes significant Medicare and Medicaid cuts and
authorizes initiatives designed to shift the payment system
from traditional fee-for-service to budgeted (e.g. bundled
payments based on episodes of care, shared savings or
capitation) or value-based (e.g. pay for performance [quality
and cost effectiveness]).
The formation of Accountable Care Organizations (ACOs) are
the core of this realignment effort.
ACO are intended to integrate hospitals and physicians into a
single health care delivery system that will be held clinically
and financially accountable for the continuum of care provided
to Medicare beneficiaries.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Delivery System Realignment (continued)
What is an Accountable Care Organization?
– An ACO must have defined processes to promote evidence-based
medicine, report on quality and cost measures, and coordinate
care.
– An ACO will enter into at least a three year agreement with HHS
and have at least 5,000 Medicare beneficiaries, without engaging
in risk selection.
– An ACO must demonstrate that it meets defined criteria for
“patient-centeredness”, including use of individualized care plans
and patient/caregiver assessments.
– An ACO will be accountable for the quality, cost and overall care of
the Medicare fee-for-service beneficiaries assigned to the ACO.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Delivery System Realignment
Conduct and analysis of the hospital's readiness to become an
ACO to include the following:
– Clinical – does your system include the necessary clinical components of
a continuum of care (e.g. hospital, physician, home care, long term care)?
– Infrastructure – does your system include necessary infrastructure
components (e.g. interoperable HIT and EMRs)?
– Financial – can your system provide the financial support necessary to
fund the above?
– Reporting, data capture and analytics – can your system capture,
analyze and report performance metrics, including quality measurements,
evidence based medicine protocols, chronic disease management and
patient satisfaction?
– Physicians – does your system employ physicians or have the
governance and management infrastructure to create a co-equal
component capable of working effectively to provide clinically integrated
accountable care?
– If your system does not have one or more of the aforementioned
capacities, can the system acquire these capacities by contract, affiliation
or purchase?
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Delivery System Realignment
While the ACA drives the Medicare model not private insurance
methodologies, many non-governmental insurers are likely to follow in
the footsteps of Medicare financing and delivery changes. [NOTE: In
2000, Medicare provided coverage to 43.3 million seniors. By 2030,
the baby boomer retirees will cause this number to almost double to
78 million covered beneficiaries.]
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Fraud and Abuse
Fraud and Abuse Prevention establishes procedures for
screening, oversight, and reporting for providers and suppliers
that participate in Medicare, Medicaid, and CHIP; requires
additional entities to register under Medicare.
Implementation: January 1, 2012.
Transparency requires drug, device, biological and medical
supply manufacturers to report to the Secretary transfers of
value (value in excess of $100 per calendar year) made to a
physician, physician medical practice, a physician group
practice, and/or teaching hospital, as well as information on
any physician ownership or investment interest in the
manufacturer. This provisions is also known as the Physician
Payment Sunshine Provision. Implementation: Reporting
starts March 31, 2013
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Fraud and Abuse (continued)
Provides that a person need not have actual knowledge of the
prohibition against health care fraud nor specific intent to
violate it in order to commit health care fraud.
Expands the scope of violations constituting a federal health
care offense.
Requires that overpayments be reported and returned within
60 days from the date the overpayment was identified or by
the date a corresponding cost report was due, whichever is
later. Failure to do so gives rise to False Claims Act liabilities
including civil monetary penalties (3x claim amount).
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Fraud and Abuse
Establish policies limiting relationships that physicians or
entities may have with drug and device companies.
Assure that policies governing annual and periodic reporting
of financial interests in drug and device companies.
Confer with drug and device vendors to become familiar with
the form and content that vendors plan to use to report
payments to assure that that form and content can be
conformed with internal hospital, physician or entity records.
An inability to reconcile internal records with publicly reported
data may raise doubts as to accuracy and increase the risk of
enforcement scrutiny.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Fraud and Abuse (continued)
Adopt new or revised policies requiring prompt reporting and
repayment of Medicare and Medicaid overpayments.
Review hospital – physician relationships that may have been
established when the “Hanlester” standard may have guided
legal opinions (Hanlester established the principal that actual
knowledge was required to commit a violation of the AntiKickback Law). ACA effectively overrules that standard
meaning that a person need not have actual knowledge or
intent to commit a violation of the Anti-Kickback Law.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Tax Exempt Hospitals
New Requirements on Non-profit Hospitals requires taxexempt charitable hospitals to: (1) conduct a community health
needs assessment every two years; (2) adopt a written financial
assistance policy for patients who require financial assistance for
hospital care; and (3) refrain from taking extraordinary collection
actions against a patient until the hospital has made reasonable
efforts to determine whether the patient is eligible for financial
assistance and imposes a tax of $50,000 per year for failure to
meet these requirements. Implementation: March 23, 2010.
Congressional Reporting requires the Secretary of the
Treasury to report to Congress on information with respect to
private tax-exempt, taxable, and government-owned hospitals
regarding levels of charity care provided, bad debt expenses,
unreimbursed costs, and costs for community benefit activities.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Action Items – Tax Exempt Hospitals
Identify all entities required to be licensed as a hospital and
review the existing financial assistance policies – revise as
needed for consistency and practicality.
Determine the means to make financial policies “widely
available”, such as posting on a web site.
Review the manner in which charges are determined for
emergency and other medically necessary services provided to
patients who qualify under the hospitals financial assistance
policy. (See IRC Section 501(r) (1)(C))
Review billing and collection arrangements and procedures for
consistency with the new requirements that “reasonable efforts”
be made to determine if an individual is eligible for assistance
under the hospitals financial assistance policy. (The “reasonable
efforts" standard is not defined in ACA.)
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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What about the Court challenges?
There are numerous court cases pending challenging all or
part of the new law. There are three (3) cases at the US
Circuit Court of Appeals level. One or more of these will be
appealed to the Supreme Court of the United States. Current
litigation status is as follows:
Michigan litigation – 6th Circuit Court of Appeals finds the individual
mandate constitutional – June 2011.
Florida multi-state litigation – on appeal to the 11th Circuit Court of
Appeals. In January 2011 the District Court found the individual
mandate unconstitutional and voided the whole law as the Court
found that the individual mandate was not severable from the law.
Virginia litigation – In two separate cases two District Courts reached
opposite conclusions one court found the individual mandate
constitutional and the other found it unconstitutional but limited the
unconstitutionality to the individual mandate and did not invalidate
the whole law. These cases have been consolidated and appealed
to the 4th Circuit Court of Appeals.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Political Headwinds:
There have been/will be attempts to repeal and/or modify
sections of the law.
The House voted to repeal the ACA January 19, 2011 – the Senate
defeated that measure February 2, 2011.
The 1099 provision, which would have raised $19 billion to help pay for
health reform, would have required business owners to file a tax
reporting document for all vendors from which they buy $600 worth of
goods or services within a year has been repealed. In April 2011, the
House and Senate voted to repeal this provision and President Obama
signed the bill.
The Community Living Assistance Services and Supports (CLASS)
program (a component of the health reform law that establishes a
national, voluntary insurance program for purchasing community living
services and supports that is designed to expand options for people
who become functionally disabled and require long-term help) may be
repealed as a deficit reduction measure. No action yet, but active
discussion
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA
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Broaden the grandfathered plan provisions to allow employers that
offer coverage to continue to offer it without changes.
Loosen the standards for plans in the Exchange.
There is legislation pending to repeal the limitations on the use of
Flexible Spending Accounts (FSAs)/Health Savings Accounts
(HSAs), but there has not been movement on the matter. [Under the
ACA effective January 1, 2011 there are changes to tax free savings
accounts including –excluding the costs for over-the-counter drugs
not prescribed by a doctor from being reimbursed through a Health
Reimbursement Account or Health Flexible Spending Account and
from being reimbursed on a tax-free basis through a Health Savings
Account and increasing the tax on distributions from a health savings
account (MSA) that are not used for qualified medical expenses to
20% of the amount used.]
Increased state flexibility - Expanded state waiver process.
Domicile-based regulation of insurance to permit interstate sale.
© 2010 Chamberlin Edmonds – Confidential & Proprietary to CEA