Because ensuring health care coverage to all Americans is a complex endeavor, not to mention a political one as well, the Patient Protection and Affordable Care Act of 2010 (PPACA) allowed considerable time for the development and implementation of its regulations.
After the law’s highly politicized adoption, the implementation of its first rules and the questioning of its constitutionality in federal courts, it now resides in a variety of federal agencies charged with working out the regulatory details that will eventually turn the law’s provisions into practical realities.
One in every six dollars of the U.S. economy is spent on a health-care related matter. With so much at stake for many businesses and interest groups, the crafting of regulations that account for all situations is difficult and painstaking. A host of federal agencies are involved, and each has a duty to give consideration to the needs of potentially impacted parties, each of which tries to advance its perspective in the regulatory design. In addition to patients (and that can be anyone), insurers, hospitals, pharmaceutical companies, medical technology manufacturers, research institutes, physicians’ groups and businesses that provide insurance to employees are all affected. LIUNA, other unions and the health and welfare funds they jointly manage with signatory employers also press their needs.
The effort is compounded by political controversy. Health care reform was a prominent issue in the 2008 elections, but the drafting of a bill became a political football. Partial versions arose, only to be dashed by competing interests. The entire effort almost collapsed, but a late push by President Obama led to PPACA’s passage. The Act then became a focus in the 2010 Congressional elections, and many House Democrats who had voted for it lost their seats. After winning control of the House, Republicans announced intentions to limit appropriations for the law’s implementation.
At the same time, the Act was challenged in federal court by a variety of forces, including about half of all state governments. Four lower courts split on the constitutionality of the individual mandate (under the law, in 2014, each American must acquire insurance coverage or pay a penalty), and one court ruled the entire law unconstitutional. As the challenges work their way toward a Supreme Court resolution in 2012, uncertainties about the law’s ultimate legality have led some state’s to dismiss preparations for its upcoming provisions while others are busy working on enabling rules and procedures.
Signed into law on March 23, 2010, the Act’s initial high profile rules took effect that September, on the eve of the mid-term elections. One required health care insurers to extend coverage to the adult children of policy holders until age 26. Another barred exclusion from coverage based on pre-existing conditions. A third eliminated lifetime dollar limits.
In addition, a fourth rule established a schedule to eliminate annual dollar maximums in three steps: on the first plan year after September 23, 2010, no annual maximum can be below $750,000; at subsequent plan years in 2011 and 2012, the maximum rises to $1.25 million and $2.0 million, respectively; after the plan year in 2013, no maximum is allowed.
Very few other provisions of the Act have effective dates in the near term. The Act’s contested individual mandate rule kicks in on January 1, 2014. At that point, with only a few minor exceptions, all Americans will be required to carry health insurance arranged through their place of work or purchased in the private market. At the same time, the American Health Benefit Exchanges are scheduled to become operational. These systems are intended to provide health insurance products for individuals to purchase, presumably at prices below current market rates, due to the “pooling” of purchasers through states’ coordinating efforts.
While the political and legal wrangling continues, federal agencies continue working behind the scenes to develop the regulations to implement the law’s upcoming, scheduled provisions. In the meantime, the LHSFNA’s Health Care Reform Updates webpage will continue to publish rules, regulations and guidance as they become available.