After meeting with top insurance industry officials and several state insurance commissioners on Tuesday, President Barack Obama unveiled a package of interim final rules that make up what the administration calls a Patients' Bill of Rights. The rules will implement various insurance reforms mandated by the new law and will take effect 60 days after publication in the June 28 Federal Register.
The overall tone of the meeting with health insurance executives at the White House seemed at times conciliatory: "The point is that there are genuine cost drivers that are not caused by insurance companies," Obama said.
However, "we've got to make sure that this new law is not being used as an excuse to simply drive up costs," Obama added. "The [insurance] CEOs here today need to know that they're going to be required to publicly justify unreasonable premium increases."
Obama introduced the proposed safeguards at a White House ceremony three months after healthcare reform was signed into law. "While it will take a few years to fully implement this law, we can already see it taking effect," Obama said.
The proposed Bill of Rights will apply to most healthcare plans renewing on or after Sept. 23 of this year. They include:
No pre existing condition exclusions for children. The new regulations will prohibit insurers from denying coverage to children [under age 19] based on pre existing conditions. The ban will include both benefit limitations and coverage denials. These provisions will apply to all types of insurance except for policies that are "grandfathered"—as specified in a White House memo sent out last week—and will be extended to all consumers starting in 2014.
No arbitrary rescissions of insurance coverage. Under the regulations, insurers and health plans would be prohibited from rescinding coverage for individuals or groups except in instances involving fraud or "intentional misrepresentation of material facts." Insurers and plans seeking to rescind coverage must provide at least 30 days' notice to give people time to appeal.
No lifetime limits on coverage. The new regulations prohibit the use of lifetime limits in all health plans and insurance policies issued or renewed on or after Sept. 23, 2010.
Restricted dollar limits on coverage. The rules will phase out the use of annual dollar limits over the next three years. Plans issued or renewed beginning Sept. 23, 2010, will be allowed to set annual limits no lower than $750,000; this minimum limit will be raised to $1.25 million beginning Sept. 23, 2011, and to $2 million beginning on Sept. 23, 2012. These limits apply to all employer plans and all new individual market plans.
Promoting choice of physicians. The new rules specify that health plan members are free to designate available participating primary care provider as their providers. The rules permit parents to choose available participating pediatrician to be their children's primary care provider. And, they prohibit insurers and employer plans from requiring a referral for obstetrical or gynecological care.
Removing insurance company barriers to emergency department services. Health plans and insurers would not be able to charge higher cost sharing (copayments or coinsurance) for emergency services that are obtained out of a plan's network. The rules also set requirements on how health plans should reimburse out of network providers.