The administration is unveiling a package of interim regulations it’s calling the Patient’s Bill of Rights today, as President Obama warns insurers against using the interim period between now and 2014 to maximize profits and urges insurance commissioners to police unreasonable rate increases. The new rules are as follows:
- Insurers will not be able to deny coverage to children with pre-existing conditions. Adults will receive this protection beginning in 2014
- Insurers can no longer impose lifetime limits on coverage and annual limits are phased out and completely eliminated by 2014.
- Insures can only rescind coverage in instances of intentional fraud. “Unintentional mistakes on application forms cannot be used to revoke a policy.”
- Insurers cannot discriminate based on salary.
- Patients can access pediatricians and women can access OB/GYNs of their choice without referrals.
- Patients will have their choice of primary care provider within the plan’s network.
Obama is requiring insurers to accept new regulations that will increase their costs while warning them against raising premiums. The administration is hoping that today’s public scolding will shift some of the blame for the coming premium increases to insurers (where some of it rightly belongs) and encourage issuers to squeeze the providers, which is good for the whole system because it brings down costs. But I’m not sure what happens if they respond by simply passing on the increases to consumers. Unfortunately, the health care law does not give the federal government enough authority to actually prevent insurers from jacking up prices.
Back in March, the Democrats (led by Sen. Dianne Feinstein (D-CA)) attempted to establish a federal rate review board that would have allowed the federal government to review and deny excessive, unreasonable or discriminatory health insurance premium increases. Conservatives quickly labeled the effort “de facto price controls,” claiming that it would “be disastrous for the American health-care system” and the provision was ultimately dropped from the final bill after staffers determined that it clashed with the reconciliation rules. The only mechanism left for controlling premiums in the interim period are the new rate review provisions. The law allows the Secretary of Health and Human Services to assist states in developing a plan for denying rate hikes or preventing insurers with “unreasonable” hikes from participating in the exchanges and the federal government has already doled out grants to help states control premium growth.
Of course, if rates really do get out of control, Feinstein’s rate review bill will likely see a resurgence and in the meantime Democrats should take every opportunity to remind everyone that Republicans — who will use the hikes to argue that the law isn’t working — slammed the very provisions that could have controlled at least some of the increases.