Edward Fensholt, JD, SVP and director of the Compliance Services and Health Reform Advisory Practice at Lockton Benefit Group, said: “[T]here’s no question the PPACA [Patient Protection and Affordable Care Act] has, to this date, bent the health insurance cost curve north, not south. As additional taxes, fees and mandates on employer-based health coverage come on line, we fear the health insurance affordability forecast will continue to deteriorate.”
Speaking at a hearing for the House Education & Workforce Subcommittee on Health, Employment, Labor and Pensions (HELP), Fensholt cited the coverage of dependents up to age 26, non-discrimination rules requiring the same coverage for all employee groups, and the requirements to reduce waiting periods to 90 days and auto-enroll eligible full-time employees in available employer-based coverage as drivers of the cost increases. In addition, Fensholt claimed excise taxes levied on insurers and third-party administrators (TPAs) will just be covered by additional cost of products.
Fensholt also testified that Lockton clients are frustrated with the additional administrative burdens imposed by the health reform law. Under federal law and regulations today, a simple group health plan is required to supply up to more than 50 separate notices, disclosures and reports to its enrollees and the government (many of those more than once), and the PPACA has added more than a dozen additional notice and disclosure obligations to health plan administration, he said.
Roy J. Ramthum, president of HSA Consulting Services, expressed concern that provisions in the health reform law will affect the success in reducing employer health care costs of consumer-driven health plans (CDHPs). He cited the requirement that employees obtain a prescription for over-the-counter medications in order to pay for them through a health savings account (HSA), the limit of health plan deductibles and the requirement for plans to provide an actuarial value of at least 60% of the cost of benefits covered by the plan as threats to CDHPs.