Health Care

Policy Accomplishments for 2011

Health Care Reform

• Repealed the 1099 Reporting Requirement—April 14, 2011
  • The Chamber mobilized extensive grassroots support and conducted massive educational efforts to pass legislation to repeal the extensive new reporting requirements that were part of the Patient Protection and Affordable Care Act (PPACA). The Chamber organized a coalition of approximately 2,700 organizations, chambers, and businesses from across all 50 states employing millions of American workers. Each signed on to the Chamber’s letter calling on Congress to repeal the 1099 reporting mandate without raising taxes on any segment of the business community.

Chamber’s Comments Modified Health Reform Regulations

• Preventive Services Coverage (Interim Final Rule)
  • Chamber comments filed on September 17, 2010, resulted in the issuance of guidance and subsequent request for information (December 28, 2010) on how to permit plans to use value-based insurance design to steer enrollees to providers that offer preventive services and demonstrate better quality and performance.
• Internal Claims and Appeals
  • Grace period for compliance extended in technical releases
• The departments of Health and Human Services, Treasury, and Labor, agreed not to take any enforcement actions against plans on the following requirements until plan years beginning on or after January 1, 2012, to give the departments time to publish new regulations necessary or appropriate to implement the statute.
  • Requirement to meet new 24 hour time frame for making urgent care claims decisions.
  • Requirement to provide notices in a culturally and linguistically appropriate manner.
  • Requirement for substantial compliance.
  • Requirement to include diagnosis and treatment codes and their corresponding meaning.

A prior technical release issued in fall 2010 had extended the requirement from July 1, 2011, until the first day of the first plan year beginning on or after July 1, 2011. This was done so that plans would not have to make changes midyear.

• Amended interim final rule incorporates the following Chamber-urged modifications:
  • Significant improvement to the urgent care claims requirement.
  • Diagnostic and treatment codes no longer required on notices.
  • Strict compliance requirement relaxed.
  • Culturally and linguistically appropriate manner requirement simplified.
  • Federal external review process improved.
  • Independent review organization requirement eased.

• W2 Reporting Requirement

On March 29, 2011, the IRS issued interim guidance (Notice 2011-31) clarifying points the Chamber raised with Treasury officials regarding when reporting must be made, which employers are exempt, the purpose of the reporting, and how the applicable premium is calculated.

• Summary of Benefits and Coverage

On November 17, 2011, the Department of Labor issued new frequently asked questions (FAQs) delaying the implementation of Summary of Benefits and Coverage. The Chamber pushed for a delay in its comments filed to the Centers for Medicare and Medicaid Services (CMS) in response to the notice of proposed rulemaking (NPRM) on October 21. However, it remains to be seen what “sufficient time to comply” means.

• Medicare Data Sharing

On December 7, 2011, the final rule was published incorporating changes requested by the Chamber in its August 8, 2011, comment letter filed in response to the proposed rule from CMS:

• Qualified entities should not have to possess data from other sources at time of application in order to be considered.
• Minimize the costs that qualified entities will be required to pay.
• Elements of the prescription drug event information for Part D claims should not be released to protect proprietary information and competition.
• Nationwide database for benchmarking.
   
• Employer Mandate

In meeting with members of the administration, in testimony, and in comments filed, the Chamber repeatedly highlighted the challenges that employers will have complying with the employer mandate requirements contained in the statute. The Department of the Treasury and the IRS have issued regulatory material modifying and clarifying how employers must comply with the employer mandate requirement on critical unworkable statutory requirements:

• An NPRM published on August 17, 2011, clarified that affordability of coverage must be based on the cost of self-only coverage.
• After repeatedly articulating to the departments that the monthly determination of full-time status is unworkable, in the IRS notice published on May 23, 2011, a look-back/stability period safe harbor was proposed in an effort to “give plan sponsors flexible and workable options as well as greater predictability.”
• After repeatedly articulating to the departments that the statutory requirement that affordability be based on household income, in a notice issued on October 3, 2011, Treasury and the IRS proposed a safe harbor that would permit employers to rely on employee’s total amount of wages as reported on the W-2 for determining affordability.

• Medical Loss Ratio (Interim Final Rule)
  • Limited benefit plans

On June 17, 2011, the Department of Health and Human Services (HHS) announced new procedures for health plans with limited benefits (including so-called mini-med plans) to obtain extended two-year waivers of the restrictions on annual dollar limits imposed by the Patient Protection and Affordable Care Act.

• OTC Medicine and the Definition of Medical Expenses (IRS Guidance)
  • After the Chamber submitted comments disputing the statutory authority for Guidance (2010-59) imposing an additional prohibition on the use of flexible spending account (FSA) and health reimbursement account (HRA) debit cards to purchase over-the-counter (OTC) drugs with a prescription, the IRS issued new Guidance (2010-128) on December 23, 2010, reversing the previous guidance and permitting the use of FSA and HRA debit cards to purchase OTC medicines.   

• Non-discrimination (Notice & Request for Comments)
  • Compliance timeline

In its comments, the Chamber asked the Treasury department and the IRS to give employers and plans a reasonable time period to comply with the new rules. On December 22, 2010, the IRS issued a Notice (2011-1) stating that compliance should not be required until after regulations and other administrative guidance of general applicability have been issued.
 

• Grandfathered Health Plans
  • On April 1, 2011, the departments of Health and Human Services, Treasury, and Labor issued FAQs about the Affordable Care Act Implementation (Part VI) that contained six additional FAQs and their answers addressing several concerns that the Chamber had highlighted for the departments. As requested in the Chamber’s comments, the FAQs did the following:
    • Provided examples as to what constitutes a bona fide employment- based reason for eliminating a benefits package.
    • Specified that changes in pharmaceutical formularies and co-pays (as a result of new generic alternatives) will not result in loss of grandfathered plan status.
    • Clarified that a plan will lose its grandfathered plan status after the plan’s change becomes effective. 
    • Clarified that if an employer contributes to premiums based on a formula, provided the formula doesn’t change, the employers’ contribution rate won’t be considered to have changed.
    • Clarified that a plan could retain its grandfathered plan status if it began imposing varying co-payment amounts for preventive services to drive consumers to get services in the proper setting. (Plans can adopt value-based insurance design approaches in offering coverage of preventive services without losing grandfathered plan status.)

• Preexisting Condition Exclusion, Lifetime and Annual Limits, Rescissions and Patient Protections
  • On August 19, 2011, HHS issued additional guidance that provides an exemption from the annual limit waiver process for certain health reimbursement arrangements (HRAs) that are subject to the PPACA annual limit restrictions that were in existence prior to September 23, 2010, from having to individually apply for an annual limit waiver (or waiver extension) for plan years beginning before January 1, 2014. 

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