Consumer advocates fear health law will favor business
By Mary Agnes Carey and Marilyn Serafini | Kaiser Health News
WASHINGTON — Publicly, consumer and patient advocates continue to cheer wildly for last year’s health care law. Behind the scenes, however, some worry that they’re losing a few key battles to the insurance and business communities.
They point to a long-sought provision in the law that entitles patients to external reviews if insurers won’t pay for a medical service, and they charge that recent regulations limit its effectiveness. One of their biggest gripes? It allows insurers to choose their own “external” reviewers.
“Advocates who have dealt with the external review process believe that it’s pretty clear that if (a reviewer) is being chosen by an employer (or insurer) it’s not independent,” said Timothy Jost, a professor at Washington and Lee University School of Law.
Erin Shields, a spokeswoman for the Department of Health and Human Services, said the administration was “working to ensure a balanced approach” toward all stakeholders. “The Affordable Care Act provides some of the most important protections for health care consumers in history,” Shields said.
With more regulations on the way, including one that will define which benefits insurers must include in many health plans, some consumer and patient advocates worry that the appeals rule could be a harbinger of things to come.
One former Obama administration official said there was cause for concern.
“There’s been a growing sentiment (in the administration), and it’s been there from the beginning, even before health reform passed, of bending to business. Now it’s reaching the boiling point,” said the former White House official, who spoke only on the condition of anonymity because of the issue’s sensitivity.
To be sure, how these rules are written can significantly help — or hurt — consumers, insurers and businesses, and that presents the White House with a tough balancing act. While it needs to reassure individuals that the law won’t disrupt their current coverage or make it more expensive, the White House also has to appease the employers and insurers who must make that happen.
Even when they feel slighted, consumer and patient groups are reluctant to complain.
“There is a sentiment in the health care community that they don’t want to push too hard,” said Carmen Balber, the director of Consumer Watchdog’s Washington office.
Consumer advocates are well aware that any controversy surrounding an implementation decision that favors them could be used by opponents as another argument to repeal the law or defeat Obama in 2012.
“They all understand that, if he loses, the law and all of its patient protections, including, of course, all of the insurance reforms and coverage expansions, will be at severe peril,” said Chris Jennings, a health care consultant who was a senior health care adviser to President Bill Clinton.
Balber complained that the administration had made the external appeals rule more business-friendly since its initial version was published last year. In the version released this year, a consumer’s ability to file an “external appeal” shrank from four months to 60 days, and the scope of what could be appealed narrowed considerably.
It also limited appeals to quarrels that involve “medical judgment” or a rescission of coverage, when an insurer cancels coverage, said Stephen Finan, senior policy director for the American Cancer Society’s Cancer Action Network. Those changes mean that patients won’t be able to appeal anything that falls into the category of contractual disputes, such as whether a particular service or drug is covered, he said.
But reviews must be conducted by independent review organizations, which are “independent and not part of insurance companies,” HHS’ Shields noted.
Patient and consumer groups criticize other aspects of the law’s implementation, including:
• It allows insurers to sit on boards that govern exchanges, the marketplaces created in the health law where eligible consumers and small businesses can start purchasing coverage in 2014.
• They find the law too vague on what happens if states want to run either an exchange for small businesses or one for individuals, but not both. “If you start dividing core functions and responsibilities and authority between the states and the federal government, that one-stop-shopping concept could disappear very quickly,” Finan said.
• It chose to base workers’ eligibility for federal insurance subsidies on the cost of individual coverage, rather than a family’s premium. People who have employer-sponsored insurance can receive federal subsidies to buy insurance on the exchanges if the coverage costs more than 9.5 percent of their incomes. Many more people would qualify if the subsidies were tied to the cost of family coverage.
Looking ahead, consumer advocates are nervously awaiting a so-called essential-benefits regulation, which will decide which medical services insurers must offer in health plans sold in the exchanges as well as in the individual and small group markets.
A key goal of the health law was to ensure that comprehensive health policies were offered to individuals and small groups. “There are a lot of plans on the market today that cover very little in the way of prescription drugs or severely limit hospital benefits,” said Edwin Park, the vice president for health policy at the Center on Budget and Policy Priorities.
(Kaiser Health News is an editorially independent news service of the Kaiser Family Foundation, a nonpartisan health care policy organization that isn’t affiliated with Kaiser Permanente.)