Healthcare Reform Update – June 11, 2010

June 11, 2010

The U.S. Department of Health & Human Services continues to work through the process of initial milestones in reform implementation. The latest:

$51 million in grant funding is being made available to states to fund rate review programs. Of note, state regulators already review rates for the individual and small group market in the regions where LifeWise operates. The HHS news release indicates priority is being given to states not currently using such a process.
Some stakeholders have expressed concern about meeting all the deadlines in implementing reform; an issue LifeWise is tracking closely. For example, the National Association of Insurance Commissioners recently missed an accelerated deadline to provide HHS with standards regarding application of medical loss ratio requirements (medical loss ratios are a key statistic in measuring medical claims as part of the healthcare dollar).

The AP recently ran a significant story on the impact of overtreatment on rising medical costs and the quality of care patients receive. The conclusion: “More medical care won't necessarily make you healthier — it may make you sicker.”
- The AP’s coverage includes a follow-up story on the cost of over-treating back pain.
Massachusetts’ experience with healthcare reform also remains in the news:
- The state is pressing stakeholders to control costs as it implements its reforms from 2006, which some have compared with federal reform.
- Closer to home, Association of Washington Business President Don Brunell focused on the Massachusetts experience in a recent edition of his frequent columns. He is concerned their outcomes will become national in scope via federal reform.

Many experts believe comparative effectiveness research, and its inclusion in healthcare reform, may be a significant step forward to addressing the issue of rising costs over time. The challenge: many consumers don’t embrace the idea, often believing that more (and more costly) care is better.
One million people may lose healthcare coverage this fall due to healthcare reform’s ban on “limited-benefit plans.” Whether or not the ban is actually implemented (HHS regulations will do much to shape the outcome), we continue to be concerned that federal healthcare reform’s stated constraints on high deductible plans will result in fewer choices for individuals and some businesses over time.

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