The Hill’s Julian Pecquet notes that Republicans have doubled down on their approach of criticizing both the potential coverage disruptions of the Affordable Care Act and the government’s efforts to minimize these changes. Republicans on the Energy and Commerce Committee have written a letter to HHS Secretary Kathleen Sebelius noting that they’re “deeply troubled that some 30 companies were forced to consider dropping coverage as a result of the law” and by HHS’ attempts to “exempt certain companies from new requirements so they can continue offering low-cost health plans.”
The letter includes various about the waiver process:
- According to USA Today, HHS has granted waivers so that “thirty companies and organizations…won’t be required to raise the minimum annual benefit included in low-cost health plans.” What companies or organizations were granted this waiver, and how many employees will this affect? Please provide a copy of both the waivers and a detailed description of the effects of the waivers.
- Have any companies or organizations asked for the waiver discussed in the USA Today article but not been granted one? If so, what companies or organizations were denied this waiver and why?
- As mentioned previously, according to the Wall Street Journal the issue is not merely whether the companies are granted waivers, but whether the insurers that offer these plans will be able to comply with new medical-loss ratios. Has HHS been contacted by any insurers to date about such a waiver to the ratio requirement? If so, please provide the names of the insurance companies that have done so. Has HHS granted any waivers of any kind to certain insurers, and if so what did those waivers entail?
- Exempting these employers from coverage requirements and penalties will likely affect the cost estimates of the health law. Has HHS calculated the effect of the waivers on the reported cost of the law? Please provide us with any information HHS holds on each exempted plan so that the impact of these exemptions may be examined.
The GOP will then use any answers to argue that the government is now arbitrarily picking winners and losers, thereby destroying America’s small businesses and job creators. As Rep. Mike Pence (R-IN) previewed the argument several weeks ago on local radio, “that’s why you don’t want a government takeover of health care, because all of the sudden you have bureaucrats with political power are going to be deciding…”
What’s really happening is that the administration is in a tough spot. If companies respond to the early regulations by dropping insurance coverage, low-wage employees will have to either go uninsured until 2014 (when the exchanges kick in) or try to enroll in Medicaid or the new high-risk insurance pools, for which they may be ineligible and may have some trouble affording. As Aaron Carroll of the Incidental Economist explains it, Democrats are facing the three-legged-stool problem. You can’t give people access to affordable coverage without regulating the insurers, getting everyone into the risk pool through the mandate and providing subsidies for those who need them, but the law implements the regulation leg four years before the subsidy and mandate legs are even attached. And so what you’re seeing now is a stool that just can’t find its balance.
Consequently, the government is exempting these companies for a year to give them an opportunity to gradually adjust their plans so they can meet the new requirements and will likely extend these exemptions through 2014 and issue even more waivers in the months to come. But as we’re seeing, this will make for its own batch of bad headlines, but it seems to be a better solution than letting thousands of low wage Americans go without coverage.