Getting Benefits into the Hands of Consumers
Since the passage of the Affordable Care Act, the Administration has worked carefully and expeditiously to strengthen the health care system for all Americans, including implementing the legislation’s early insurance market reforms. We have made significant progress to over the past year. Accomplishments during 2010 include:
Improving the Affordability and Accessibility of Health Coverage
- Giving Consumers Better Value for Insurance Premiums: On November 22, 2010, the Department of Health and Human Services, (HHS) issued rules that require health insurance plans to spend 80 to 85% of consumers’ premiums on direct care for patients and efforts to improve care quality. This regulation, known as the “medical loss ratio” provision of the Affordable Care Act, will make the insurance marketplace more transparent and make it easier for consumers to purchase health insurance plans that provide better value for their money.
- Issuing a Patient’s Bill of Rights: On September 23, 2010, the Affordable Care Act’s Patient’s Bill of Rights took effect and began protecting consumers. The Patient’s Bill of Rights stops health insurance companies from: imposing pre-existing condition exclusions on children except in limited cases; rescinding or taking away coverage based on an unintentional mistake on an application; setting lifetime dollar limits on coverage and setting annual dollar limits on coverage by phasing out, and eventually restricting, annual limits. Annual dollar limits will be eliminated for most plans issued or renewed beginning January 1, 2014. If an insurer requests a temporary waiver from the annual dollar limits between now and then, they are required to notify consumers that their health insurance coverage is subject to an annual dollar limit lower than what is required under the law.
- Ensuring Access to Providers and Emergency Care: On September 23, new rules took effect for new health insurance plans to ensure that patients in plans covered by the rules can choose an available primary care doctor or pediatrician of their choice from a plan’s provider network, and that most women can see an OB-GYN without needing a referral. Many insurance companies will not be able to require prior approval before you seek emergency care at a hospital outside your plan’s network, and will not be able to require higher co-payments or co-insurance for such care than would be charged in network.
- Helping Americans to Keep the Coverage They Have Now: On June 14, the Administration issued rules defining “grandfathered health plans.” The rules help give Americans the ability to keep their current plan if they like it, while minimizing market disruption and putting us on a glide path toward the competitive, patient-centered market of the future.
- Strengthening the Ability to Appeal Insurer Decisions: On July 22, the Administration issued rules to empower consumers to appeal decisions made by their health plans or health insurance companies. Additional guidance was issued in August and September to offer model notices, transition periods, and details of the new process.
- Reviewing Health Insurance Rate Increases: The Affordable Care Act includes $250 million to support state efforts to review rates and guard against unreasonable rate increases. HHS awarded $46 million in grants to help States to review rate increases on August 16.
- Informing Consumers through HealthCare.Gov: On July 1, the Administration launched www.HealthCare.gov, a new, easy-to-use website that helps consumers take control of their health care and make the choices that are right for them by putting the power of information at their fingertips. The website is the first of its kind to bring information and links to health insurance plans and other coverage options into one place, to make it easy for consumers to learn about their health insurance choices. And the site includes extensive, easy to understand information about patients’ rights, how to navigate the current insurance market, and how the Affordable Care Act will help them. A Spanish language version was launched on September 8, and additional pricing information was added on October 1. We updated that information again on November 15 and now have pricing and quality information for nearly double the number of insurance plans – 8,500.
- Providing Support for State Consumer Assistance Efforts: On October 19, nearly $30 million in Consumer Assistance Grants were awarded to help States and territories put patients in charge of their health care. These grants will support States’ efforts to establish or strengthen consumer assistance programs that provide consumers with the information they need to pick from a range of health coverage options as well as to provide assistance with enrollment; educate consumers about their rights and obligations; help them appeal decisions when a plan denies coverage; and generally track consumer problems.
- Providing Small Business Tax Credits: Starting in April 2010, the Administration notified small employers regarding $40 billion in tax credits to help small employers that purchase health insurance for employees. The IRS has delivered post cards to nearly four million small businesses and tax exempt organizations that could qualify to make them aware of the credit and has conducted hundreds of briefings and meetings for small businesses and the accountants and practitioners who serve them.
- Insuring Young Adults Early: Under the new law, young adults are allowed to enroll in or stay on their parent’s health insurance plan until they turn 26 years old. Some health insurers began implementing this practice before it was implemented on September 23. (In the case of parents with existing group health plans, young adults are only allowed on if they do not have an offer of health insurance coverage through work.)
- Creating the Pre-Existing Condition Insurance Plan (PCIP) Program: On July 1, the Pre-Existing Condition Insurance Plan Program was established to provide coverage for eligible Americans who have been uninsured for six months because of a pre-existing condition. Coverage started in 47 States by August, and all States are accepting applications and providing coverage. Rules for the program were published on July 30.
- Supporting Early Retirees: The Early Retiree Reinsurance Program offers $5 billion to employers so they can more easily give benefits to their retired workers who are not eligible for Medicare. The program’s benefits became effective June 1, three weeks ahead of schedule. The first round of approvals was announced on August 31, along with a new website (www.errp.gov) and policy guidance; additional accepted applicants are posted on www.HealthCare.gov monthly. Companies have been able to submit claims for payment as of October 2010.
- Expanding Medicaid Options: The Centers for Medicare and Medicaid Services (CMS made available federal funding to States that elect the statutory option to cover low-income childless adults through Medicaid in advance of the 2014 coverage requirement. The new funding will help States that are already working to provide coverage to more of their residents.
- Expanding Community Health Centers: On October 8, HHS awarded $727 million to 143 community health centers across the country to address pressing construction and renovation needs and expand access to quality health care. The funds are the first in a series of awards that will be made available to community health centers under the Affordable Care Act. Another $335 million is available for existing community health centers under the Expanded Services (ES) initiative.
In addition, on November 19, the Health Resources and Services Administration (HRSA) at HHS announced the awarding of nearly $8 million in Affordable Care Act funds for existing Community Health Center Cooperative Agreements to provide additional training and technical assistance to community-based organizations that support community health centers.
On November 22, HHS announced that this year’s investment in the National Health Service Corps (NHSC) includes $290 Million from the Affordable Care Act to help primary care clinicians repay student loans while serving communities. The NHSC offers primary care medical, nursing, dental and mental health clinicians up to $60,000 to repay student loans in exchange for two years of service at health care facilities in medically underserved areas.
- Laying the Groundwork for Exchanges: On September 30, HHS announced $49 million dollars in grants to help 48 States and the District of Columbia plan for the establishment of these health insurance Exchanges. These grants of up to $1 million each will provide States with resources to conduct the research and planning needed to build a better health insurance marketplace and determine how their Exchanges will be operated and governed.
On October 29, HHS announced new, competitive “Early Innovator” grants for States to design and implement the Information Technology (IT) infrastructure needed to operate Health Insurance Exchanges. On November 3, HHS announced that new federal funding is available to all States to streamline and upgrade their Medicaid eligibility systems in preparation for the changes resulting from the Affordable Care Act in 2014. HHS also announced guidance to help States design and implement the information technology (IT) needed to establish exchanges.
- Closing the Medicare Part D “Donut Hole” for Seniors: HHS implemented the process to provide $250 rebate checks for eligible Medicare beneficiaries who fall into the prescription drug coverage gap known as the donut hole. As of November 23, more than 2.1 million beneficiaries had received checks. The checks are the first step in closing the donut hole.
- Lowering Drug Costs: CMS secured agreements with drug manufacturers of virtually all brand-name drugs covered by Medicare to provide a 50 percent discount on brand name drugs purchased in the prescription drug coverage gap known as the donut hole in 2011. In addition, Medicare Actuary estimates that the Part D drug benefit premium in 2011 will not be higher than it was in 2010.
- Ending Excessive Payments to Insurance Companies: CMS implemented payment policy changes to the Medicare Advantage program for 2011 that will begin the process to correct Medicare’s excessive payments to private health insurance plans in the Medicare Advantage program. The resources will help strengthen Medicare for all seniors, provide all beneficiaries with important new benefits and extend the life of the Medicare Trust Fund. Seniors who choose Medicare Advantage plans will continue to receive their guaranteed benefits.
- Educating Seniors and the American Public: On June 8, the President hosted a town hall meeting to discuss with seniors the Affordable Care Act. A brochure describing the new law and its implications was sent to all Medicare beneficiaries on May 24. Educational ads featuring Andy Griffith were launched on July 31, the 45th anniversary of Medicare. In addition, the Administration has hosted over 20 Web Chats on different topics regarding the new law, including the President demonstration how to use the HealthCare.gov.
- Fighting Fraud: The Affordable Care Act includes significant new tools that will help fight fraud and protect taxpayer dollars. Using these new tools, Secretary Sebelius has pledged to cut Medicare’s error rate (the percentage of claims paid inappropriately) in half by 2012. Attorney General Holder and Secretary Sebelius have asked the State Attorneys General to join forces in a coordinated nation-wide effort to fight and prevent health care fraud. A series of summits is planned across the country to jump-start this effort on a local level. The first summit was held in Miami on July 16, the second was in Los Angeles on August 26, and the third was in New York on November 5. A proposed regulation implementing the first round of Affordable Care Act policies to combat Medicare and Medicaid fraud was issued on September 17.
- Ensuring All New Health Insurance Plans Cover Proven Prevention: New plans purchased on or after September 23, are required to cover certain recommended preventive services, including mammograms, colonoscopies, immunizations, and well-baby and well-child screenings, with no deductibles, copayments, or coinsurance.
- Ending Beneficiary Payments for Prevention: Starting in 2011, Medicare beneficiaries can get preventive care services like colorectal cancer screening and mammograms without paying additional cost sharing.
- Adding an Annual Wellness Visit to Medicare: Starting in 2011, Medicare will pay for an annual wellness visit so that seniors can receive the free preventive benefits they need as well as advice on how to stay healthy.
- Awarding $250 million in Grants for Prevention: The Administration allocated the 2010 Prevention and Public Health Fund to programs to support activities such as community initiatives and the development of the public health infrastructure that can help prevent disease and illness before it starts. In addition, $31 million has been awarded to as part of the HHS Communities Putting Prevention to Work (CPPW) program.
- Launching the Prevention Council and Plan: An executive order to create the National Prevention, Health Promotion and Public Health Council was signed on June 10. It met and produced a preliminary report on July 1, and met again on September 15 to review its plan for the coming year. The draft framework for the Plan is now online and HHS is accepting public input at http://www.healthcare.gov/prevention/nphpphc/index.html.
Building the Foundation of an Affordable, High-Quality Health System
- Spurring Innovation and Lowering Costs: The Treasury Department has awarded $1 billion through the therapeutic discovery program, which provides tax credits and grant to small businesses to encourage the development of new and cost-saving therapies, support good jobs, and increase U.S. competitiveness.
Also, on November 16, CMS formally established the new Center for Medicare and Medicaid Innovation (Innovation Center). Created by the Affordable Care Act, the Innovation Center will examine new ways of delivering health care and paying health care providers that can save money for Medicare and Medicaid while improving the quality of care. CMS also announced the launch of new demonstration projects that will support efforts to better coordinate care and improve health outcomes for patients.
- Protecting Patient Safety, Reducing Medical Liability: In September, 2009, President Obama called on the Department of Health and Human Services to make grants available for projects that have the potential to improve patient safety and reduce medical liability. Grants for these projects totaling $23 million were awarded in June.
- Strengthening the Health Care Workforce with $250 million in Grants: These grant opportunities, along with other funding in the Affordable Care Act and the American Recovery and Reinvestment Act, will train up to 16,000 primary care physicians, physician assistants and nurse practitioners over the next 5 years.
- Strengthening the Long-Term Care System: A joint Administration on Aging (AoA) and CMS initiative has awarded $68 million in grants to States and communities to help individuals and their caregivers better understand and navigate their health and long-term care options. In addition, letters to State Medicaid Directors outlined new options for home- and community-based care on June 22, August 6, and September 9.
- Supporting Programs to Help Families: On July 21, HHS announced the award of $88 million in grants, provided under the Affordable Care Act, to support evidence-based home visiting programs focused on improving the wellbeing of families with young children. Grant opportunities for Family to Family Health Information Centers were announced on October 26. On September 30, HHS awarded $155 million in teen pregnancy prevention grants, and on September 29, HHS awarded $27 million in grants to help pregnant and parenting teens.
- Appointing Boards and Commissions: In addition, steps have been taken to establish commissions that address a series of issues including:
- Alaska Workforce: It completed its work and its final report was issued on September 17.
- COOP program: Its appointees were announced on June 23 by GAO.
- Personal Assistance Workforce: It was chartered in May.
- Committee on Breast Cancer in Young Women: CDC announced the appointees on October 15.
- National Prevention, Health Promotion, and Public Health Council: On June 10, the President signed an Executive Order creating the National Prevention Council.
Posted: December 20, 2010