HHS Rules on 5 Key Consumer Protections

Last week, the Department of Health and Human Services (HHS) issued a “final rule that implements five key consumer protections from the Affordable Care Act, and makes the health insurance market work better for individuals, families, and small businesses.” Those 5 key protections are:

1.  “Guaranteed Availability” of coverage:  no more pre-existing conditions exclusions.

2.  “Fair Health Insurance Premiums: Health insurance companies offering coverage to individuals and small employers will only be allowed to vary premiums based on age, tobacco use, family size, and geography.  Basing premiums on other factors will be illegal.  The factors that are no longer permitted in 2014 include health status, past insurance claims, gender, occupation, how long an individual has held a policy, or size of the small employer.”

3.  “Guaranteed Renewability”:  Similar to the Guaranteed Availability above, “health insurance companies will no longer refuse to renew coverage because an individual or an employee has become sick.”

4. “Single Risk Pool: Health insurance companies will no longer be able to charge higher premiums to higher cost enrollees by moving them into separate risk pools.  Insurers are required to maintain a single state-wide risk pool for the individual market and single state-wide risk pool for the small group market.”

5.  “Catastrophic Plans: Young adults and people for whom coverage would otherwise be unaffordable will have access to a catastrophic plan in the individual market.  Catastrophic plans generally will have lower premiums, protect against high out-of-pocket costs, and cover recommended preventive services without cost sharing.”

“And, HHS has increased the transparency by directing insurance companies in every state to report on all rate increase requests.   A new report has found that the law’s transparency provisions have already resulted in a decline in double-digit premium increases filed: from 75 percent in 2010 to, according to preliminary data, 14 percent in 2013.”

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