Health Care Reform Implementation Update June 7, 2012

While the Supreme Court makes its decision on the Affordable Care Act, lawmakers in Washington, D.C., are driving forward repeal-oriented legislation and simultaneously talking about reinstating elements of the Act should the whole thing be struck down, while HHS, CMS, and the IRS all released new or proposed rules on how to implement elements of the Act, and states like California and Oregon moved closer to full implementation of the Affordable Care Act.


The IRS issued guidance on employer implementation of the Affordable Care Act’s new $2,500 cap on employee contributions to flexible health savings accounts, and has requested comments on possible changes to the “use-or-lose” rules for health FSAs. The $2,500 limit will become effective with cafeteria plan years beginning after December 31, 2012 and will be indexed for inflation.

CMS released its 2011 data on the Primary Care Incentive Program which, established by the Affordable Care Act, requires Medicare to pay primary care providers whose primary care billings comprise at least 60 percent of their total Medicare allowed charges, a quarterly bonus of 10 percent from Jan. 2011 – Dec. 2015. The majority of funds (86 percent) went to physicians practicing in urban areas, and roughly 50 percent went to general internists while 38 percent went to family physicians.


Awaiting the Supreme Court’s decision on the Affordable Care Act, Senate Republicans now appear to be embracing a contingency plan rumored to be afoot among key House Republicans: Reinstate popular provisions of the Affordable Care Act if the Supreme Court overturns the law. Notable provisions under discussion include the ability of young adults to stay on their parents’ insurance through age 26, a guarantee of coverage for those with pre-existing conditions, and plans to close the Medicare prescription drug coverage gap known as the “doughnut hole.”

The House Ways and Means Committee marked up four bills and related measures on flexible savings accounts and health savings accounts, which easily passed committee with strong support from Democrats and Republicans.

The previously private details of a lengthy negotiation and deal between the Obama administration and the pharmaceutical industry on the Affordable Care Act were made public last week when the House Energy and Commerce Oversight and Investigations Subcommittee released a memo and associated documents as part of its ongoing investigation launched more than a year ago.


New Hampshire’s Granite State Network has teamed up with Cigna to launch a collaborative accountable care initiative that is focused on achieving many of the same goals as accountable care organizations.

Oregon’s Health Authority has provisionally certified 11 organizations to be the state’s first coordinated care organizations under an overhaul of the Oregon Health Plan, made possible by the Obama administration’s approval earlier last month of a $1.9 billion grant. The 11 organizations will be responsible for integrating health care for low-income patients on Medicaid, and more organizations are expected to apply for certifications soon and possibly come online this autumn.

California’s state senate approved a bill to make numerous protections of the Affordable Care Act – such as ensuring individuals do not lose or get denied coverage because of pre-existing conditions and requiring every health plan to include guaranteed availability and renewability of coverage – part of California law.


The nation’s largest umbrella group for U.S.-based Catholic nuns, which recently disagreed with the Catholic Bishops’ analysis of the health care law and supported President’s Obama plan, spoke out after the Vatican said the group had adopted “certain radical feminist themes incompatible with the Catholic faith.”  The nuns said the Vatican’s assessment was unsubstantiated and result of a flawed process, and they will take their concerns to a meeting in Rome on June 12.

To view our compilation of recent health care reform implementation news, click here.

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