Patient Protection & Affordability Care Act — how to proceed:
In our last article we stated the first step in dealing with the new legislation is to not overreact. It will be best to take a conservative approach to the various provisions. Deal with those matters that are closest at hand, but keep an eye on the road so you know what turns you want to make ahead.
Things will likely change a bit, if not a lot, by the time they actually take effect. In fact, at a recent meeting on the topic with a panel of experts, there was considerable discussion about how many holes in the legislation still needed to be plugged before people truly know what steps to take — things like when the detailed regulations would be published, definitions had to be clarified, what happens after the required comment period(s), and then even further clarification.
Probably one of the most notable points from the meeting I attended was that this legislation was really about “insurance reform,” not “health care reform.” The biggest health care aspect of the legislation is access. It allows many more people into a care system that is not ready. That part of the equation will have to gear up quickly and/or change methods in order to accommodate the new demand levels. Changes in delivering care may influence how some organizations react.
Back to insurance reform: Our job is to determine what to expect, and how to react. However, what to expect is a bit harder than you might think. There are many organizations and publications pointing out the policies and the details of what the legislation says.
The critical element to the process is the focus of insurance reform: the insurance companies.
All these “insurance” organizations with their years of experience, substantial resources and smart people are not waiting to be told what to do. They will not just roll over and let the government beat them with a stick. They will influence the regulations, they will mount “information” campaigns, they will restructure as necessary — all with the intent of maintaining or improving the bottom line.
Out of chaos comes opportunity. They will create the new products (heath care derivatives?) that they will bring to and which will thereby influence the market. It might be the way the new insurance exchanges get revenue. They will be a driving force that will batter the regulations and provisions into some new requirements by 2014 and beyond.
Now is the time for some simple strategies that will prepare your organization for making prudent decisions. You want your benefit designs to effectively work for you and your employees in the new environment. To do this, you need information.
For example, the new law allows dependent children to be covered under the parent’s plan in some circumstances. Who are these children? How do you qualify the married daughter with a new last name? Do you know if the spouses of your employees are working and covered by insurance, or what the spouses’ employers are going to do in the new health care landscape?
Eventually, you may need to know about family income levels, if they are low wage earners. Some future threshold regulatory requirements will look at special arrangements for those people who are less than four times the federal poverty level. You will need to know how much employees pay for health care premiums as a percent of pay and what they contribute into various health care plans.
You might start to ask questions about what information can be captured by your human resource/payroll system and those of your vendors.
Wellness will be a big element in the coming years. The inability to rule out pre-existing conditions and the elimination of lifetime claims caps may mean it will be best to emphasize healthy lifestyles and encourage behavior change. Perhaps establishing base lines with a Health Risk Appraisal that tracks progress with incentives for change is something to consider.
We will look at some of those strategies in our next article.
Ardon Schambers is a principal with P3HR Consulting & Services LLC.