Rep. Tim Huelskam (R-KS) is alleging that a new Affordable Care Act regulation could require insurers to fork over personal patient information to the government” and force companies to “share sensitive information about their business models.” The rule — which is not yet finalized — is the result of a provision in the law that establishes a “risk adjustment” mechanism to compensate insurers who take on too many sick patients; it’s intended to level the playing field and discourage companies from cherry-picking applicants.

But Huelskam — along with Fox News — are suddenly raising privacy concerns about the rule:

“We think the rule is stepping well beyond where we should be,” Huelskamp told FoxNews.com Tuesday. “There was never any indication that I know that this private health care data would be in the hands of federal bureaucrats.”…”The end result is a bureaucrat would have access to individual claims data,” he said. [...]

“Folks out there would love to see their individual business records … and that would hurt their market competition as a result of that,” he said, reflecting the concerns of the insurance company that contacted him. “The risk modeling by which they determine their premiums, by which they determine who qualifies … they spent many years and many dollars putting together their model.”

HHS insists that it is committed to ensuring patient privacy and is currently soliciting comments from the health care industry and the general public about how best to bolster patient confidentiality. As Media Matters’ Justin Berrier pointed out yesterday, HHS recognizes that, “this approach may raise concerns related to consumer privacy and standard submission formats. Accordingly, we propose national standards to address each of these issues. We seek comment on the proposed approach, as well as comments on the potential advantages and disadvantages of the alternative approaches.” The reinsurance provision in the ACA strikes a similar tone: ” The State, or HHS on behalf of the State, must make relevant claims and encounter data collected under risk adjustment available to support claims-related activities as follows…(1) Provide HHS with de-identified claims and encounter data for use in recalibrating Federally-certified risk adjustment models.”

HHS has extended to comment period for the proposed rule to Oct. 31 and will issue a final regulation shortly thereafter.

House Budget Chairman Paul Ryan (R-WI) offered a Republican replacement to President Obama’s Affordable Care Act yesterday that would slowly unravel the employer-based health care system and provide families and individuals with a tax credit to purchase insurance on the individual health market. Americans denied coverage because of pre-existing conditions could enroll in a state-based high-risk insurance pool full of sick people.

But don’t expect all Republicans to get behind the plan. While the GOP will continue to push for complete repeal of health care reform, Chuck Clapton, Sen. Mike Enzi’s (R-WY) chief health care staffer, told Politico’s Jennifer Haberkorn this morning that Republicans won’t put forward a united proposal until the party has decided on a presidential nominee. “Members of Congress aren’t going to want to get in front of the candidate…I don’t know if there is much of a political advantage that comes from a candidate laying out what a repeal and replace strategy would be right now.” Watch it:

Clapton also said Republicans support some of the health care savings laid out by Obama in his new deficit proposal, pointing specifically to the administration’s reductions in the prevention fund and the changes to Medigap policies. He added that the GOP would be looking for savings in the Affordable Care Act, including lowering subsidies to middle class Americans for the purchase of health insurance coverage.

Republicans are already harping on yesterday’s Kaiser study — which found that premiums for employer-based coverage have increased by 9 percent — to claim that the Affordable Care Act is raising health care costs and undermining the Democrats’ promises of savings. Health care wonks were indeed surprised to see such dramatic premium increases (the highest since 2005) during a period of lower care utilization. Americans are skipping doctors visits to save money during a troubled economy and insurer are posting higher profits — so why are premiums still climbing?

The early benefits from reform — requiring insurers to offer prevention services without additional cost sharing and allow young adults to stay on their parents policies — are responsible for just 1 to 2 percentage points of the increase, much of the rest, insurers say, is simply overcompensation: companies charged higher than required premiums in anticipation that their costs would rebound once the economy recovered and Americans went back to utilizing more care. It’s a win-win business model for the companies, who keep the mark-up as profit if utilization fails to rebound, but a real burden on consumers who are having trouble affording the increase in premiums. Fortunately, the Affordable Care Act will begin to change that as insurers are required to spend 80 to 85 percent of premium dollars on providing health care benefits (the so-called medical-loss ratio provision) and states are empowered to review premium increases.

As the New York Times’ Reed Abelson and Nina Bernstein report, some states are already using federal grants made available by the health law to lower “unreasonable” increases:

New York, along with states including California, Connecticut and North Carolina, has been exercising its regulatory muscle to try to tamp down some of the increases. The Obama administration this month funneled a total of $109 million to many states, in part to help fight against “unreasonable” increases.

The increases now under consideration in New York would affect 1.3 million of the 3 million residents in individual and small-group plans; the amounts vary considerably depending on the type of policy. The increases requested by Aetna, for example, range from 8.9 percent to 53.6 percent, while those from United Health Group/Oxford range from 13 percent to 34 percent, according to the State Insurance Department.

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In New York, consumer advocates contend that the latest requests exceed any documented rise in costs, with some companies enjoying three years of record profits and paying millions of dollars in dividends and executive compensation. “We’re at a watershed moment,” said Elisabeth Benjamin, who represents Health Care for All New York, a group of 100 organizations advocating affordable care. “The Cuomo administration has to decide, will the Department of Insurance stand up for the little guy, John Q. Public, or let the insurance companies get away with this nonsense?”

Some analysts are already predicting lower premiums for 2012, “saying costs are slowing down and increases in premiums would probably be more moderate.” Small business also “expect their premiums not to rise as sharply, only because younger, healthier employees are keeping claims low.” Yesterday’s Kaiser report found that “an estimated 2.3 million young adults under age 26 have been added to their parents’ health plans as a result a provision of the 2010 Affordable Care Act. That’s even more than the number estimated recently by the Census Bureau or the Centers for Disease Control and Prevention.”