Three Things You Need To Know About The New Obamacare Rules

The Centers for Medicare and Medicaid Services (CMS) and the Department of Health and Human Services (HHS) released a slew of important new Obamacare rules and regulations this week, continuing a widely expected post-election effort to successfully implement President Obama’s landmark health care reform law by 2014.

In a call with reporters, CMS and HHS outlined the new proposed rules, which instruct insurers, providers, and governmental institutions on how they must proceed in implementing Obamacare measures — ranging from a ban on discriminating against Americans with pre-existing medical conditions to public wellness initiatives such as coverage for employees’ gym use. Here are the three most important things you need to know about the new rules:

1) Insurers will be prohibited from discriminating against Americans with pre-existing conditions. Long considered one of the health insurance industry’s most odious practices, refusing to extend coverage to Americans suffering from a pre-existing medical condition will soon be a thing of the past. The first of CMS’s proposed rules mandates that insurance companies will need to base their premium rates solely on an individual’s age, family size, geography, and history of tobacco use — preventing discrimination against Americans for any other reason, such as their gender or their chronic illnesses. The rule will also set strict limits on how much insurers can vary the premiums they charge Americans based on these factors, marking an end to gender rating practices that charged women more than men for the same medical services. This will be a boon to the over 120 million Americans who suffer from a pre-existing condition in one form or another.

2) State exchanges will establish a standard of “essential health benefits” that every plan will be required to cover. Obamacare will require the plans offered under state-wide health insurance exchanges in 2014 to clear federal benchmarks across ten “essential health benefit” categories, including access to maternal care, mental health services, preventative health care, and prescription drug coverage. These assured benefits — which are supposed to reflect the level of coverage offered by a typical employer-sponsored plan — will help correct for spotty coverage that does not actually meet Americans’ medical needs. CMS’s proposed rule requires state exchanges to offer to the same level of coverage as a statewide benchmark health plan of the state’s choosing. If a state’s chosen benchmark plan does not cover all of Obamacare’s required benefit categories — for instance, by not offering mental health services — then the federal government will intervene and supplement that plan so that it does meet the health law’s coverage requirements. The rule also creates standards for prescription drug coverage so that such coverage actually meets Americans’ health care needs and prohibits health plans from designing their benefits in a way that discriminates against certain groups of Americans.

3) Wellness programs will help promote public health and curb health care costs. The last of the three proposed rules is joint guidance from HHS, the Treasury, and the Department of Labor regarding sponsorship of workplace wellness programs. Obamacare encourages preventative health initiatives and a transition from “sick care” to actual “health care” in an effort to both improve Americans’ quality of life and lower national health spending. Under the proposed rule, employers are encouraged to continue both participatory and health-contingent wellness programs — such as subsidizing the cost of employees’ fitness center memberships or enrolling employees in tobacco-cessation programs — in exchange for federal rewards.

These rules will give states more clarity as they move forward in implementing the Affordable Care Act. Although many Obamacare details must still be worked out — particularly regarding the statewide insurance exchanges — the reform law has madeenormous strides in the last year that will result in a fairer, more accessible, and more affordable American health care system that is a marked improvement over the pre-Obamacare era. “It’s important to remember what this market looked like back in 2009… We were definitely headed in the wrong direction,” HHS Secretary Kathleen Sebelius said on the conference call.


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