Sebelius: Americans Who Like Their Coverage Can Keep It

Echoing President Obama’s key message on health care reform, U.S. Department of Health and Human Services Secretary Kathleen Sebelius held a press briefing June 14 to emphasize again that if Americans like their current health care plan, the Affordable Care Act allows them to keep it.

“The notion that everyone is going to loose their coverage is simply not the case,” Ms. Sebelius said.

In addition, Ms. Sebelius and Department of Labor Secretary Hilda Solis explained that the grandfather clause allows employers with existing health insurance plans (as of March 23, 2010) to make routine changes and still keep their grandfather status. However, Ms. Sebelius warned, employers and insurers will lose that status if they make coverage changes that effectively reduce or cancel coverage, or if they raise premiums or co-pays significantly.

If an employer chooses to make substantial changes to the plan that shift costs to the employees, “The rules of the road are clear... They basically have lost the grandfather status, and it is regarded as a new plan,” Ms. Sebelius said.

In the event that an employer or insurer loses its status, consumers in those plans will gain additional new benefits including coverage of recommended preventive health services at no additional cost and guaranteed access to ob gyns and pediatricians.

Ms. Sebelius predicted that large companies are more likely than smaller ones to meet the grandfather clause requirements and will therefore see fewer changes.

There will be oversight tools in place to penalize companies that try to raise rates and reduce or deny coverage. Such tools should make it easy to single out companies that increase their rates in ways that impact consumers negatively. Some companies may try to mask increases or try to justify their price increases, but there will be “enhanced ability at the federal level to reject excessive premiums,” she said.

Publishing premium rates should allow for “more transparency” and will also help keep companies in line, she added.

As of Sept. 23, all plans – grandfathered or not – will be required to provide:

– No lifetime limits on coverage;

– No rescissions of coverage when people get sick and have previously made an unintentional mistake on their application; and

– Extension of parents’ coverage to young adults under age 26 years.

In addition, for those Americans who get their health insurance through employers (the majority), additional benefits will be offered, irrespective of whether their plan is grandfathered. Those benefits include:

– No coverage exclusions for children with pre-existing conditions; and

– No “restricted” annual limits (e.g., annual dollar-amount limits on coverage below standards to be set in future regulations).

By 2014, Americans should be able to take advantage of the “same [health insurance] choices as members of Congress,” Ms. Sebelius said.

The act will give employers “a wide berth of flexibility,” allowing them to adjust to medical inflation, but also encouraging them to come to the table to work with the government to help lower costs, she said.

Ms. Sebelius, who met with members of the AMA earlier in the day, admitted that the “right financial incentives” are not in place for doctors and their practices, but “we have to work together to accelerate the change... and look at underlying costs.”

Echoing President Obama’s key message on health care reform, U.S. Department of Health and Human Services Secretary Kathleen Sebelius held a press briefing June 14 to emphasize again that if Americans like their current health care plan, the Affordable Care Act allows them to keep it.

“The notion that everyone is going to loose their coverage is simply not the case,” Ms. Sebelius said.

In addition, Ms. Sebelius and Department of Labor Secretary Hilda Solis explained that the grandfather clause allows employers with existing health insurance plans (as of March 23, 2010) to make routine changes and still keep their grandfather status. However, Ms. Sebelius warned, employers and insurers will lose that status if they make coverage changes that effectively reduce or cancel coverage, or if they raise premiums or co-pays significantly.

If an employer chooses to make substantial changes to the plan that shift costs to the employees, “The rules of the road are clear... They basically have lost the grandfather status, and it is regarded as a new plan,” Ms. Sebelius said.

In the event that an employer or insurer loses its status, consumers in those plans will gain additional new benefits including coverage of recommended preventive health services at no additional cost and guaranteed access to ob gyns and pediatricians.

Ms. Sebelius predicted that large companies are more likely than smaller ones to meet the grandfather clause requirements and will therefore see fewer changes.

There will be oversight tools in place to penalize companies that try to raise rates and reduce or deny coverage. Such tools should make it easy to single out companies that increase their rates in ways that impact consumers negatively. Some companies may try to mask increases or try to justify their price increases, but there will be “enhanced ability at the federal level to reject excessive premiums,” she said.

Publishing premium rates should allow for “more transparency” and will also help keep companies in line, she added.

As of Sept. 23, all plans – grandfathered or not – will be required to provide:

– No lifetime limits on coverage;

– No rescissions of coverage when people get sick and have previously made an unintentional mistake on their application; and

– Extension of parents’ coverage to young adults under age 26 years.

In addition, for those Americans who get their health insurance through employers (the majority), additional benefits will be offered, irrespective of whether their plan is grandfathered. Those benefits include:

– No coverage exclusions for children with pre-existing conditions; and

– No “restricted” annual limits (e.g., annual dollar-amount limits on coverage below standards to be set in future regulations).

By 2014, Americans should be able to take advantage of the “same [health insurance] choices as members of Congress,” Ms. Sebelius said.

The act will give employers “a wide berth of flexibility,” allowing them to adjust to medical inflation, but also encouraging them to come to the table to work with the government to help lower costs, she said.

Ms. Sebelius, who met with members of the AMA earlier in the day, admitted that the “right financial incentives” are not in place for doctors and their practices, but “we have to work together to accelerate the change... and look at underlying costs.”

Echoing President Obama’s key message on health care reform, U.S. Department of Health and Human Services Secretary Kathleen Sebelius held a press briefing June 14 to emphasize again that if Americans like their current health care plan, the Affordable Care Act allows them to keep it.

“The notion that everyone is going to loose their coverage is simply not the case,” Ms. Sebelius said.

In addition, Ms. Sebelius and Department of Labor Secretary Hilda Solis explained that the grandfather clause allows employers with existing health insurance plans (as of March 23, 2010) to make routine changes and still keep their grandfather status. However, Ms. Sebelius warned, employers and insurers will lose that status if they make coverage changes that effectively reduce or cancel coverage, or if they raise premiums or co-pays significantly.

If an employer chooses to make substantial changes to the plan that shift costs to the employees, “The rules of the road are clear... They basically have lost the grandfather status, and it is regarded as a new plan,” Ms. Sebelius said.

In the event that an employer or insurer loses its status, consumers in those plans will gain additional new benefits including coverage of recommended preventive health services at no additional cost and guaranteed access to ob gyns and pediatricians.

Ms. Sebelius predicted that large companies are more likely than smaller ones to meet the grandfather clause requirements and will therefore see fewer changes.

There will be oversight tools in place to penalize companies that try to raise rates and reduce or deny coverage. Such tools should make it easy to single out companies that increase their rates in ways that impact consumers negatively. Some companies may try to mask increases or try to justify their price increases, but there will be “enhanced ability at the federal level to reject excessive premiums,” she said.

Publishing premium rates should allow for “more transparency” and will also help keep companies in line, she added.

As of Sept. 23, all plans – grandfathered or not – will be required to provide:

– No lifetime limits on coverage;

– No rescissions of coverage when people get sick and have previously made an unintentional mistake on their application; and

– Extension of parents’ coverage to young adults under age 26 years.

In addition, for those Americans who get their health insurance through employers (the majority), additional benefits will be offered, irrespective of whether their plan is grandfathered. Those benefits include:

– No coverage exclusions for children with pre-existing conditions; and

– No “restricted” annual limits (e.g., annual dollar-amount limits on coverage below standards to be set in future regulations).

By 2014, Americans should be able to take advantage of the “same [health insurance] choices as members of Congress,” Ms. Sebelius said.

The act will give employers “a wide berth of flexibility,” allowing them to adjust to medical inflation, but also encouraging them to come to the table to work with the government to help lower costs, she said.

Ms. Sebelius, who met with members of the AMA earlier in the day, admitted that the “right financial incentives” are not in place for doctors and their practices, but “we have to work together to accelerate the change... and look at underlying costs.”