A faint ray of hope might be peeping out of proposed federal health insurance market standards regulations.
Officials at the U.S. Department of Health and Human Services (HHS) do seem to understand that the Patient Protection and Affordable Care Act of 2010 (PPACA) could cause unwanted upheaval in the private health insurance market, according to Steve Zaharuk, a senior vice president at Moody’s Investors Service.
“It is positive that HHS continues to recognize the potential for adverse selection by individuals by including specific provisions to prevent or limit this,” Zaharuk wrote in a commentary released by Moody’s earlier this week.
Zaharuk was responding to a batch of PPACA regulation drafts that HHS and other departments published in the Federal Register Monday.
Zaharuk suggested that one sign of HHS officials’ interest in managing risk might be a proposal to apply open-enrollment rules outside the PPACA exchange system as well as inside the exchange system.
“Establishing a limited time period during which individuals are able to enroll in an insurance plan prevents them from waiting until they are sick to purchase coverage,” Zaharuk said.
PPACA calls for states to work with HHS to set up a system of “health insurance exchanges,” or Web-based insurance supermarkets, by late 2013.
Individuals and small groups are supposed to be able to use new tax credits to buy coverage through the exchanges
Many individuals who fail to own a minimum level of health coverage would pay a tax. The tax would start at $95 for individuals in 2014 and rise to $695 by 2016.
Health insurers would face tough new restrictions on underwriting.
Health insurers could not use personal health information when deciding whether to issue coverage.
When pricing coverage, health insurers could still use geographic information and information about an enrollee’s family size.
HHS is thinking about letting a health insurer use wellness program information, such as information about weight or blood pressure, to determine incentive penalties or rewards with a value amounting to about 50 percent of the value of the policy premium.