Senator Rockefeller pointed out that there was a gigantic loophole in the Baucus bill that would leave half of Americans subject to potential discrimination by private insurers. Apparently due to existing federal law, large companies can call themselves “self-insurers” even though they provide coverage through a major insurance company. These sort of self-insurance plans are mostly exempt from state regulations and are allowed to deny coverage based on pre-existing conditions.
The regulations in H.R. 3200, the House health care bill, and in the Senate HELP bill, offer self-insured Americans protections against denial of coverage based on pre-existing conditions, no lifetime caps or annual caps on their coverage, and ensures they’ll receive the same benefits as other employees in their workplace.
The loophole is that Senator Baucus’s bill doesn’t offer self-insured Americans these protections against denial of coverage, no lifetime caps or annual caps on their coverage, and basically leaves them out in the cold. That’s what Senator Rockefeller discussed in this story below:
The Baucus Bill doesn’t offer the same explicit guarantees it grants patients in standard plans, Rockefeller says.
“It’s a huge problem,” he says.
So, he’s introduced an amendment to get the bill in line with the others. He isn’t sure why Baucus chose to omit it in the first place — and isn’t entirely sure if the Montana Democrat supports his effort.
“I have no idea who put the bill together,” Rockefeller adding that Baucus is “receiving about 500 bits of information a minute… He’s very, very busy, I understand that, but this is a very, very big problem.”
Here’s the link to the Rockefeller amendment C1 that would address this glaring loophole in Senator Baucus’s bill. This is the Chairman’s mark as stated:
No insurance market reforms applied to the individual and small group markets would be applied to the self-insured market. Additionally, insurance market reforms would not be applied to the large group market until 2017. In 2017, states must develop and submit to the Secretary a phase-in schedule (not to exceed five years), including applicable rating rules, for incorporating firms with 50 or more employees (or 100 or more employees for those states that already included firms with 51-100 employees) into the state exchanges. The Secretary must develop regulations to address the potential for any risk selection issues associated with allowing larger employers into the state exchanges. Initial phase in for these firms would begin in plan years 2018 and beyond.
And what Rockefeller’s amendment is meant to do:
Effective January 1, 2013, all of the insurance market reforms applied in the exchange would be applied immediately to both self-insured and large group plans.
The offset for this would be capping itemized deductions at 35%. No wonder why Senator Baucus didn’t bring up Rockefeller’s amendment today.
The Line In The Sand 