D.C. Court of Appeals Upholds Health Care Reform Requirement

      The District of Columbia  Circuit Court of Appeals today upheld the health care reform law’s         requirement that nearly all Americans buy insurance by 2014 or face penalties.    This ruling comes   just days before the Supreme Court is expected to consider whether to take up the  issue. That decision could come as soon as Thursday, when the justices will hold a private conference to discuss what cases to take this term.

The D.C. Circuit is now the second appeals panel to uphold the health reform law’s individual mandate. The law’s supporters are declaring victory because the opinion was written by a conservative judge, Laurence Silberman, who was nominated by former President Ronald Reagan. Silberman and Senior Judge Harry Edwards, who was nominated by former President Jimmy Carter, upheld a lower court ruling that the law was constitutional.  Judge Brett Kavanaugh, who was appointed by former President George W. Bush, dissented.

The D.C. Circuit Court is the fourth appeals panel to consider a lawsuit challenging the health reform law. The 6th Circuit upheld the law, the 11th Circuit struck the mandate and the 4th Circuit ruled that the Anti-Injunction Act which says Americans have to pay a tax before they can challenge it in court barred it from ruling on the mandate until at least 2014.

2012 Health Care Reform Checklist

Anthem Blue Cross of California has recently provided a checklist of key items employers may need to to make sure they are on target with Health Reform Rules.  This list can be found at:


Please contact our office at (888) 474-6627 to verify what you may need to do as an employer to stay in compliance.

copyright Anthem 2011 used with permission.

Proposed Rules for Summary of Coverage Available

In follow up to our post from August 18, 2011, the departments of Labor and Health and Human Services (with the
Treasury) laid out the new proposed rules for the “uniform summary of coverage” that is required under PPACA.   Health insurers and group health plans have to provide consumers with clear, consistent and comparable information about their health plan benefits and coverage starting in 2012.

All health plans and issuers would provide a summary of benefits and coverage, along with a glossary of terms to employees before enrollment.  Health plans and issuers will also provide notice at least 60 days before any significant modification is made in the plan or coverage during the plan or policy year.  The summary of benefits coverage would be some simple standard boxes for comparison shopping. If the exchanges are in place by 2014, this would allow an employee to compare employer sponsored coverage against other market-available options.

As these are merely proposed, there is nothing final and employers do not have to immediately act, nor can then act until the proposed
uniform definitions are drafted. But employers and plan sponsors should keep this information handy as a reference point for developing a long-term compliance strategy.

For more details about the proposed regulations, please go to the dol website at www.dol.gov.


HHS Announces Proposed Rule for Uniform Benefit Summaries

On August 17, the Department of Health and Human Services (HHS) released a Notice of Proposed Rulemaking for Uniform Benefit Summaries under the Patient Protection and Affordable Care Act (PPACA).

The intent of Uniform Benefit Summaries is to provide individuals with standardized information so they can review medical plans, compare insurers and make decisions about medical plan choices.  The proposed rule provides additional guidance on the information that must be provided to all individuals enrolling in a medical plan on or after March 23, 2012.

This provision applies to individual and employer-sponsored medical plans, regardless of grandfathered status or funding. It does not apply to retiree-only plans or to standalone dental and vision plans.

What Information Must be Included

Insurers and self-insured employers must provide a Summary of Benefits and Coverage (also referred to as an ‘SBC’ in the proposed rule) to individuals who apply for and enroll in medical plans. The Summary of benefits and Coverage is a required document that must be provided in the standard format.

There are four standard components:

  • A four-page Benefit Summary (double sided)
  • Medical Scenarios called “Coverage Examples” that  are patterned after the Food and Drug Administration food labels. They estimate customer costs based on the specific plan’s benefits for three medical scenarios – Maternity, Breast Cancer Treatment and Managing Diabetes
  • A standard glossary of medical and insurance terms
  • A phone number and website where individuals can get additional information including documents such as Certificates, Summary Plan Descriptions (SPDs) and policies

HHS asked the National Association of Insurance Commissioners (NAIC) to propose a format for the four components in the Summary of Benefits and Coverage. Here is a link to the documents proposed by NAIC: http://www.naic.org/committees_b_consumer_information.htm

The information on the NAIC website is not a guideline or example. It is the exact wording, format and layout that must be used. Insurers and employers will just insert plan details into the predetermined rows and columns.

The Benefit Summary must be a freestanding document and may not be incorporated into any other document. Supplemental
communication materials may be provided with it. Currently produced documents will not satisfy the requirements of the regulation.

The Coverage Examples must include three pre-defined medical scenarios: Maternity, Breast Cancer Treatment and Managing Diabetes. These scenarios are intended to show typical services and cost sharing under the plan. The numbers would be based on client-specific plans and costs. The estimates are based on national average costs and in-network benefit levels.

Who is Responsible for Providing the Information

For fully insured plans and HMOs, the insurer is responsible for producing and distributing the summaries. For self-insured
plans, the responsibility lies with the employer.

What is the Required Timing

Summaries must be provided when an employer or individual requests information about a plan, applies for coverage or enrolls in
a plan. They must also receive a summary if there are plan changes or if the individual has a HIPAA special enrollment event that prompts a new enrollment opportunity.

People enrolled in a health plan must be notified of any significant changes to the terms of coverage reflected in the Summary of
Benefits and Coverage at least 60 days prior to the effective date of the change. This timing applies only to changes that become effective during the plan or policy year but not to changes at renewal (the start of the new plan or policy year).

How Benefit Summaries will be Delivered

Summaries are required both before and after enrollment and may be delivered in paper and/or electronic format. There are
specific requirements for group vs. individual plans.

Penalty for Non-Compliance

The penalty for ‘willful’ non-compliance is up to $1,000 per enrollee for each failure to comply.

Next Steps

Comments on this proposed rule – including the specific request for expatriate plans – are due 60 days from the published date.

New HHS Guidelines for Women’s Preventative Services

 On Aug. 1, 2011, the Department of Health and Human Services (HHS) released new health  plan coverage   guidelines that will require health insurance plans to cover women’s preventive services such as well-  woman visits, domestic violence screening, and U.S. Food and Drug Administration (FDA)-approved contraception, without charging a copayment, coinsurance or a deductible.

Authorized under provisions of the Patient Protection and Affordable Care Act, these guidelines, developed by a committee of the Institute of Medicine of the National Academies, expand the previous list of preventive services that must be covered without charging a copayment, coinsurance or a deductible to include:

  • Well-woman visits
  • Screening for gestational diabetes for all pregnant women
  • Human papillomavirus DNA testing for all women 30 years and older
  • Annual sexually transmitted infection counseling for all sexually active women
  • Annual counseling and screening for HIV for all sexually active women
  • FDA-approved contraception methods, sterilization procedures and contraceptive counseling
  • Breastfeeding support, supplies, and counseling, including costs for renting breastfeeding equipment
  • Domestic violence screening and counseling

New health plans and non-grandfathered plans and issuers are required to provide coverage consistent with these guidelines in the first plan year (in the individual market, policy year) that begins on or after August 1, 2012.  It is possible that your current health plan covers these services now, but may have a copay or co-insurance percentage.

Government Changes Announced for Annual Limit Waivers for Mini-med Plans

The U.S. Department of Health and Human Services (HHS) recently announced new procedures for health plans with limited benefits (including so-called “mini-med” plans) to obtain temporary waivers of the restrictions on annual dollar limits that were imposed by the Patient Protection and Affordable Care Act.

Employers may adopt mini-med and similar health plans to provide limited health insurance coverage (for example, health benefits capped at $20,000 per year) to a segment of employees that otherwise would not have access to the employer’s standard health coverage.

Under the new procedures, previously granted waivers for mini-med and similar health plans are extended through 2013 if the applicants report certain information about their plans to HHS on an annual basis and disclose additional information to enrollees about the limits of their plans’ coverage. Recipients of existing waivers must apply to HHS to extend their waivers by September 22, 2011. Any plans that have not yet applied for waivers must also apply by September 22, 2011.

The Affordable Care Act generally prohibits group health plans from imposing lifetime and annual dollar limits on certain benefits, beginning with the first plan year that starts on or after September 23, 2010. The Affordable Care Act allows annual limits to be phased out gradually through 2014, with minimum annual limits of $750,000, $1.25 million, and $2 million for the 2011, 2012, and 2013 plan years, respectively.

As part of the transition process, HHS established in September 2010 a temporary program (for years prior to 2014) to permit individual mini-med and similar health plans to apply for a waiver of the restricted annual dollar limit if the plan could demonstrate that compliance with the annual dollar limit rules would result in either a significant decrease in access to benefits or a significant increase in premiums for the plan or policy. Under the original waiver program, the applicant needed to reapply for the waiver each year. The new procedures eliminate the annual reapplication process, but require applicants to take action by September 22, 2011, and satisfy certain additional requirements.