ACA still missing key regulatory details
Some key regulatory details remain unanswered in the final months before the Patient Protection and Affordable Care Act’s major provisions launch. Obama administration officials have insisted that they have issued all of the major regulations for the 2010 healthcare overhaul and are now focused on implementing the law’s central pillars—state health insurance exchanges and expanded Medicaid coverage—later this year. But health policy experts said they still expect important regulations implementing provisions of the law, plus a large amount of so-called subregulatory guidance.
Sam Batkins, director of regulatory policy at the conservative American Action Forum, counts 32 proposed rules that remain to be finalized, including IRS rules on Medicare taxes and requirements for providers to report and return Medicare overpayments within 60 days.
Other highly anticipated regulations still to come this year deal with various components of the health insurance marketplaces, experts say.
Those new exchanges are expected to begin enrolling millions of private insurance subscribers in each state Oct. 1 and start providing coverage in January.
Four rules addressing various aspects of exchanges are undergoing review by the White House Office of Management and Budget—typically the final stage before a rule is issued.
Among those regulations is the final version of a proposed rule published in the fall of 2011 governing appeals by people denied eligibility for Medicaid coverage and provisions on subsidies for exchange coverage. The final rule was submitted to the OMB for review May 13; the law requires a final rule by Jan. 1, 2014.
Those rules on components of the exchanges and the Medicaid expansion demonstrate the highly interwoven nature of the law and its implementing rules. The rules need to clarify the point at which a person qualifies for Medicaid or subsidized exchange coverage and whether that can change multiple times annually, known as churning. These implementing rules have taken on greater significance since the law did not anticipate factors that have complicated that situation, such as the Supreme Court’s decision to allow states to choose not to expand Medicaid.
“Do you get held in Medicaid for the whole year, or do you just keep flipping in and out of the system, which is a terrible
“Do you get held in Medicaid for the whole year, or do you just keep flipping in and out of the system, which is a terrible thing for continuity-of-care purposes.”
—Julie Barnes Executive director Breakaway Policy Strategies
thing for continuity-of-care purposes,” said Julie Barnes, executive director of Washington-based consultancy Breakaway Policy Strategies.
Other components in the law that remain unfinished, experts say, include final rules on the employer mandate— which imposes financial penalties on some businesses if any employees seek subsidized coverage on the state exchange. Proposed rules on coverage provided or limitations and taxes assessed when coverage is deemed insufficient were issued earlier this year.
Like many nonhealthcare businesses, skilled-nursing facilities are watching for clarifications on employer reporting provisions related to the employer mandate, said Erin Sutton, a senior director at the American Health Care Association, a trade group
for skilled-nursing facilities. For instance, they are looking for clarification on how employees need to be told about coverage options. Skilled- nursing facilities are among the healthcare providers least likely to offer employee health benefits that meet the coverage standards necessary to avoid federal penalties, according to health industry experts.
“It’s hard for employers to inform employees about coverage options when the exchanges are not up and running in every state and it’s not known what plans are going to be offered,” said Julie Scott Allen, a government relations director for Drinker, Biddle & Reath, a law firm that lobbies on healthcare issues.
HHS is expected to provide many of the remaining details implementing ACA statutory language through “guidance” that does not follow the formal rulemaking process. Those less formal methods of implementing statutory language have drawn provider criticism in the past over concerns that they lack a process to review and account for unintended adverse impacts.
“Right now, we are in the land of bulletins and guidance and Q&As that help flesh out what the rule couldn’t have done because we are in a state of flux,” Barnes said.
For example, critical details are still awaited on the operation of the federal data-services hub. That hub will combine information on each insurance exchange applicant from disparate federal databases, and make it available to the state insurance exchanges to determine eligibility for coverage and subsidies. States and insurers are waiting for guidance on what information the data hub will require, and by when.
“This is the most unsung part of what needs to happen before the exchanges are possible,” Barnes said.
Additional health law-related details will be part of the annual inpatient prospective payment system update. Federal officials will need to finalize a proposed rule issued April 26 that offered changes to the Medicare disproportionate-share hospital payment system and proposed cuts based on incidence of hospital-acquired conditions.
“With many of these measures, there are questions about how reliable they are,” said Daniel Hettich, a senior associate at King & Spalding, a law firm that lobbies on healthcare issues. “It’ll be interesting to see how (HHS) responds to comments in the final rule.”