HHS Giving Waivers to Small Health Plans

The Department of Health and Human Services (HHS) has okayed 94 percent of requests – primarily from sponsors of “mini-med” and other limited healthcare plans – for waivers that excuse them from meeting a key requirement of the Patient Protection and Affordable Care Act (ACA). According to HHS Secretary Kathleen Sebelius, the waivers are needed because most mini-med plans do not meet federal rules mandated by the healthcare reform law, which establishes a minimum yearly dollar limit on essential benefits that plans must provide in 2011, 2012 and 2013. For 2011, the minimum is $750,000, rising to $1.25 million in 2012 and $2 million in 2013.  To date, 919 of 975 waiver applications have been approved by HHS, according to Representative Henry Waxman (D-CA), the ranking Democrat on the House Energy and Commerce Committee.

“We are committed to making the waiver process transparent to the public and to make sure workers with mini-med plans are informed about the limited nature of their coverage,” said Steve Larsen, director of oversight in HHS’s Office of Consumer Information and Insurance. “For example, we have required plans that receive waivers to inform their enrollees that their coverage is limited.  HHS also helps to ensure transparency by posting a list of the plans that have been granted waivers, so stakeholders understand how they are affected.”  To date, waivers have been granted in Florida, New Jersey, Ohio and Tennessee.  Members of Congress said that in several other states, insurers and employers will need similar exemptions from some of the law’s requirements.

Not surprisingly, House Republicans slammed HHS for granting the waivers, claiming that they are proof that the Affordable Care Act is deeply flawed. “I think it is an understatement to say that these waivers have been controversial,” said Representative Cliff Stearns (R-FL).  “Obamacare was sold as all benefit — no downside.”  Plans that were granted waivers represent about 2.4 million people, or about one percent of the employer-based coverage market overall, according to HHS.

Additionally, House Republicans expressed concern that power over public and private health insurance programs was concentrated in the Centers for Medicare and Medicaid Services, led by an official, Dr. Donald M. Berwick, who has not been confirmed by the Senate. “He is in charge of almost all insurance coverage in the United States,” said Representative Michael Burgess, (R-TX).

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