Jody Hall, a cupcake baker, today told lawmakers that she thinks the Patient Protection and Affordable Care Act (PPACA) minimum medical loss ratio (MLR) requirements are already helping to hold her health insurance coverage prices down.
Ed Fensholt, a compliance specialist at Lockton Companies L.L.C., Kansas City, Mo., said his firm believes that PPACA requirements already are increasing the typical client’s health coverage costs about 2% to 3% and adding $1 per employee in health plan tax costs.
In 2014, when more PPACA taxes are set to take effect, the PPACA taxes alone could increase costs $10 to $15 per employee, Fensholt said.
The witnesses appeared at a hearing on health care costs organized by the House Education and the Workforce health subcommittee.
Rep. Phil Roe, R-Tenn., the chairman of the subcommittee — a critic of PPACA — said the country should do more to help employers control costs by changing the rules that government health savings accounts (HSAs) and flexible spending accounts (FSAs).
PPACA has imposed a $2,500 annual cap on FSA contributions and restricted holders of HSAs and FSAs from using account funds to buy over-the-counter drugs without a prescription, Roe said.
When implementing PPACA minimum plan value rules, the Obama administration may be preparing to value employer and worker HSA contributions in a way that would discoverage employers from offering HSAs, Roe said.
“However, even though more than 12,000 pages of rules and regulations have been written, there are still many unanswered questions surrounding the law that make it virtually impossible for any employer – large or small – to plan for the future,” Roe said.
Roe said that, so far, no one knows how the Obama administration will define the “essential health benefits” package required by PPACA. He said the administration has made qualifying for “grandfathered status” — a status that lets plans avoid complying with some PPACA requirements — too difficult, and he contended that the administrative cost of using a new PPACA small business health insurance tax credit has been too high for small businesses to use the credit.
Fensholt said Lockton, a large insurance brokerage firm, has no quarrel with the goal of PPACA.
Lockton also respects the officials at the U.S. Department of Health and Human Services, the Internal Revenue Service and the U.S. Labor Department who have been implementing PPACA, Fensholt said.