Today, led by Chief Justice John Roberts, the Supreme Court upheld the constitutionality of the Affordable Care Act in almost all respects. While upholding the controversial individual mandate to purchase health insurance, the Court did alter one important aspect of the law, however, in that it limited the government’s ability to withhold all Medicaid funds from a state contingent on the states’ acceptance of the significant Medicaid expansion called for under the Act. Under the Court’s ruling, a state must be allowed to opt out of the Medicaid expansion without threatening the state’s current Medicaid coverage and federal funding. The text of the decision can be found here.
Section 4205 of the Patient Protection and Affordable Care Act of 2010 (PPACA) requires chain restaurants and vending machine operators with 20 or more locations or machines to provide calorie and other nutrition information to consumers. Although FDA’s statutory deadline to publish the proposed rules was March 23, 2011 (within one year of PPACA’s enactment), the rules, entitled Food Labeling; Nutrition Labeling of Standard Menu Items in Restaurants and Similar Retail Food Establishments and Food Labeling; Calorie Labeling of Articles of Food in Vending Machines were published in the April 6, 2011 Federal Register and the public is invited to submit comments by July 5, 2011.
The Departments of Health and Human Services, the Treasury and Labor (DOL) posted on the DOL website answers to new questions about the Patient Protection and Affordability Act and earlier healthcare legislation. Previously issued answers are also available on the website. The new guidance addresses the design of preventive health care benefits; automatic enrollment in group health plans; notices to participants about material modifications in individual or group plans; coverage of dependent children up to age 26; pre-existing condition exclusions for children in the individual health insurance market; and grandfathered health plans. The agencies anticipate issuing further guidance in response to stakeholder questions.
The Department of Health and Human Services, the Department of Labor and the Internal Revenue Service issued a Request for Information (RFI) on December 28, 2010 on how group health plans and health insurance providers can deliver high-quality preventive care services cost-effectively under the Patient Protection and Affordable Care Act. The agencies are interested particularly in suggestions on how welfare benefit plans can encourage use of the most beneficial preventive services and discourage use of the least beneficial services. Public comments must be submitted before February 28, 2011.
On November 1, 2010, the IRS announced the names of the companies that received tax credits or grants under the Qualifying Therapeutic Discovery Project program. The program was created as part of the Patient Protection and Affordable Care Act to promote the development of therapeutic drugs. Eligible companies had to have no more than 250 employees. The IRS, in conjunction with the Department of Health and Human Services, approved applications for projects that showed significant potential to produce new and cost-saving therapies, support jobs and increase U.S. competitiveness.
Under the program, a total amount of $1 billion was allocated for credits and grants with a $5 million limit per each eligible applicant. Since awards were made by project, companies were eligible to receive funding for multiple projects, each worth up to $244,479.24, designed to offset 50 percent of qualifying research and development costs.
Several important provision aimed at protecting insurance consumers will soon be required. Specifically, for plan years beginning on or after September 23, 2010, insurers can no longer:
- Deny coverage to children with pre-existing conditions;
- Impose lifetime limits on benefits;
- Retroactively cancel insurance coverage without proving fraud;
- Deny claims without a chance for appeal;
- Charge out-of-pocket costs for preventive health services; or
- Require prior approval or charge higher copayments or coinsurance for emergency room services outside the network.
Insurers must also provide coverage for a beneficiary’s dependent child who is under 26 and unable to obtain coverage from an employer. For more information, see the federal health reform website and the AG Health Reform insurance reform summary.
On September 14, 2010, the U.S. Department of Health and Human Services (“HHS”) announced $31 million in awards to support community public health efforts to reduce obesity and smoking, increase physical activity and improve nutrition. The awards are funded by the Prevention and Public Health Fund included in the Patient Protection and Affordable Care Act, and are part of the Communities Putting Prevention to Work (“CPPW”) program administered by the Centers for Disease Control and Prevention (“CDC”). Ten communities in eight states and one state health department received awards to increase the availability of healthy foods and beverages, improve access to safe places for physical activity, discourage tobacco use, and encourage smoke-free environments. More information about the CPPW program and CPPW awardees is available through the CDC website.
The departments of Health and Human Services (HHS), Labor and the Treasury issued interim final regulations on July 14, 2010 requiring health plans beginning on or after September 23, 2010 to cover certain recommended preventive services. Under the new regulations, such health plans may not charge patients copayments, coinsurance or deductibles for these services when they are delivered by a network provider. Covered preventive services include—
- evidence-based items or services with an A or B rating in the U.S. Preventive Services Task Force recommendations with respect to the individual involved
- immunizations for routine use in children, adolescents and adults with a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention with respect to the individual involved
- evidence-informed preventive care and screenings for infants, children and adolescents that are included in the comprehensive guidelines supported by the Health Resources and Services Administration (HRSA)
- Evidence-informed preventive care and screening for women included in the comprehensive guidelines supported by HRSA (not otherwise addressed by the recommendations of the Task Force). HHS expects to issue these guidelines by August 2011.