Insurers Dispute Health Bill’s Mandate to Cover Children with Pre-Existing Conditions

Jodi Jacobson

Kaiser Health News reports today that the insurance industry lobbyists claim the health reform bill signed by President Obama this week lacks a clear mandate for immediate coverage of children with pre-existing conditions, potentially leaving these children vulnerable for four more years.  The Administration says it will fix the loophole.

Kaiser Health News reports today that the America’s Health Insurance Plans (AHIP), an insurance industry lobbying group, claims the health reform bill signed by President Obama this week lacks a clear mandate for immediate coverage of children with pre-existing conditions, leaving these children vulnerable for four more years.

[H]ealth advocates and some insurers say the law does not clearly state that such protection starts this year. If it doesn’t, uninsured children with pre-existing conditions might not get help until 2014, when the law requires insurers to issue policies for all applicants regardless of health condition. There is no doubt that for children who are enrolled in insurance plans, the new law bars insurers from excluding coverage of any pre-existing conditions.

According to the authors of the KHN article, Phil Galewitz and Andrew Villegas, America’s Health Insurance Plans, the main insurance lobbying group, says through a spokesman that “it interprets the new law as not requiring insurers to cover all child applicants this year.”

Randy Kammer, a vice president for Blue Cross and Blue Shield of Florida, the largest health insurer in that state, said she interprets the law as allowing insurers to reject coverage for children in some cases until 2014.

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Earlier this week, write Galewitz and Villegas, “some health advocates said they worried the health overhaul might not do what was intended.”

“This could be a large loophole,” Janis Gurney, public policy co-director of Family Voices, said Tuesday. The organization, based in Albuquerque, N.M., represents families of children with special needs.

But, KHN reports, officials said Wednesday the law does prohibit insurers from denying children coverage starting this year, but they will issue clarifying regulations.

“The law is clear: Insurance plans that cover children cannot deny coverage to a child because he or she has a pre-existing condition,” Health and Human Services spokesman Nick Papas said. “To ensure that there is no ambiguity on this point, the Secretary of HHS is preparing to issue regulations next month making it clear that the term “pre-existing exclusion” applies to both a child’s access to a plan and to his or her benefits once he or she is in the plan.” 

KHN also quotes a joint statement by Reps. Henry A. Waxman (D-CA), Sander M. Levin (D-MI), and George Miller (D-CA), the Democratic chairmen of the three committees with jurisdiction over health policy in the House of Representatives:

“Under the legislation … plans that include coverage of children cannot deny coverage to a child based upon a pre-existing condition. We have been assured by the Department of Health and Human Services that any possible ambiguity in the underlying bill can be addressed by the Secretary with regulation.”

AHIP and others are warning that being required to cover children with pre-existing conditions will lead to increased insurance premiums and argue for a delay in required coverage.

Health insurers worry that if they’re forced to cover all children regardless of health condition, higher rates will result, because only the families of sick kids would apply. That problem, they say, could be largely avoided if the requirement went into effect in 2014, when most Americans will have to have coverage under the law. AHIP says higher rates resulted when New York and a handful of other states enacted “guarantee-issue” laws requiring insurers to offer coverage to all applicants.

“It is important to keep in mind the experience in states that implemented guarantee – issue laws without getting everyone covered, and the impact those reforms had on the affordability of health care coverage,” said AHIP spokesman Robert Zirkelbach.

The new health reform law requires insurers to cover children who do not have a large gap in coverage, leaving more vulnerable those whose parents buy coverage for children on the individual market and whose children have been uninsured more than two months. Federal law requires insurers to cover children who do not have a large gap in coverage.

One thing is clear, states KHN: “The law does nothing to stop insurers from charging higher rates for children with pre-existing illnesses until 2014 when insurers can no longer use health status in setting premiums.”

Rising insurance premiums have indeed led to record profits by insurance companies.  Triangle Business Journal reports that according to the Washington, D.C.-based Health Care for America Now, the five largest U.S. health insurance companies – including four of the five largest insurers in the Raleigh-Durham area – had a combined profit of $12.2 bilion in 2009.

The group said that was a 56 percent jump from 2008.

The companies are UnitedHealthGroup Inc., WellPoint Inc., Aetna Inc., Humana Inc. and Cigna Corp.

Joan Alker, co-executive director of the Center for Children and Families at Georgetown University in Washington D.C., is among those worried about the language. After learning of the administration’s comments Wednesday, she said, “It is clear they are looking at this, which is good, and it is a very complex and technical issue so I think at this point we will wait and see what happens.”

KHN reports that “Parents whose kids are turned down by an insurer would still have a fallback under the law, even without a regulatory fix. They could seek coverage through an insurance pool for people who can’t obtain coverage. The federal government will support the pool with $5 billion.”

It’s not known how many children are currently denied coverage because of pre-existing conditions. But it’s a common complaint.

News Sexual Health

People With HIV Will Soon Have Access to Life Insurance

Martha Kempner

Major insurance provider Prudential announced on World AIDS Day, December 1, that it would offer ten- and 15-year convertible term policies to HIV-positive people who meet certain health qualifications.

Those living with HIV will be able to purchase a standard life insurance policy for the first time. Prudential Financial, Inc. announced on World AIDS Day, December 1, that it would offer ten- and 15-year convertible term policies to HIV-positive people who meet certain health qualifications.

Insurance industry and public health officials see this as further evidence that HIV is now viewed as a manageable chronic illness.

People living with HIV can’t legally be excluded from their employer’s group life insurance policies, but such plans tend to have small payouts, such as one year of salary. Policies that pay more have been mostly unavailable to those who are HIV-positive. Some companies claimed to offer such policies if individuals could meet other strict health requirements, such as adherence to antiretroviral drug protocols and undetectable viral loads, but insurance agents said that even clients who met these standards often were rejected.

Life insurance policies help people provide for family members left behind, but this peace of mind is not the only thing individuals living with HIV are lacking by being denied such policies. People are required to have life insurance in order to adopt children or undertake certain business transactions.

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Bill Grant, co-founder of ÆQUALIS, a financial services company serving people living with HIV, explained to Kaiser Health News that he realized how limiting the lack of life insurance was when his HIV-positive brother could not finish a business deal they were trying to do together because he could not get the required life insurance.

Grant channeled his frustration into starting ÆQUALIS. The company was able to collect and analyze enough data to plot new mortality curves that convinced Prudential to offer ten- and 15-year term life insurance to those with HIV.

“There’s been just enough history to project long enough into the future to get started on this path,” Grant explained.

Many with HIV are leading long lives. A 2013 study found that a person in the United States or Canada diagnosed with HIV at 20 years old, who starts drug therapy right away, can be expected to live another 50 years. Mike McFarland, vice president of underwriting for Prudential Individual Life Insurance explained in a statement: “With advances in the successful treatment of people with HIV, we are now able to offer this population the opportunity to apply for life insurance—a milestone we see as a significant step in the right direction.”

The company has health requirements for people living with HIV, like it does for other populations. It is looking for people to be at least a year out from their HIV diagnosis and six months into a drug regimen. It will require certain blood cell counts, though those have not yet been reported. Anyone with an “AIDS-defining condition” will be disqualified, as will those who acquired the virus through a blood transfusion or intravenous drug use.

The company says such restrictions are similar to what they look for with other chronic diseases, such as heart disease.

This acknowledgement that HIV can be a manageable chronic illness is a big step for a disease that was once considered a death sentence, Scott Schoettes, HIV Project director at Lambda Legal, told Kaiser Health News.

“Finally, an insurance company has realized that this is the right thing to do and that it is profitable from a business perspective to offer this product to people living with HIV,” Schoettes said. “Now that there is one company out there doing this, it will encourage others to do the same when they see that there is money to be made in this market.”

News Law and Policy

How the ‘Cromnibus’ Bill Affects Women’s Health

Emily Crockett

There are some steps forward and some steps backward for reproductive and sexual health issues, but in some ways the bill is most remarkable for adhering to the status quo.

The U.S. House of Representatives passed a bill Thursday night funding most of the government through September and the Department of Homeland Security through February. The bill is expected to pass the Senate in the next few days.

It was a bitterly controversial piece of legislation. Critics on the left, including Minority Leader Nancy Pelosi (D-CA), refused to support the bill because it radically loosens campaign finance rules and gets rid of an important financial reform in the Dodd-Frank bill. On the right, some said it didn’t do enough to block President Obama’s executive order that temporarily protects nearly five million unauthorized immigrants from deportation.

Less remarked upon has been what the spending bill has to say about lawmakers’ priorities for women’s health. There are some steps forward and some steps backward for reproductive and sexual health issues, but in some ways the bill is most remarkable for adhering to the status quo.

Anti-choice Republican legislators “really laid off a lot of areas they could have gone after, at least in this round,” Heather Boonstra, director of public policy at the Guttmacher Institute, told Rewire.

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That is, the pots of money for the kinds of family planning programs routinely targeted by conservatives remained untouched, but those programs didn’t get any new funding either.

This could be further evidence of the Republican Party trying to hide its anti-choice stances, as many candidates did in the midterm elections. It could also signal a party biding its time until it takes the majority and is able to push more extreme anti-choice measures like a national 20-week abortion ban.

The so-called “Cromnibus” bill included a long-overdue fix that would make sure that Peace Corps volunteers can finally get equal access to abortion coverage in cases of rape, incest, or life endangerment.

Right now these volunteers, who often make only a $300 a month stipend and may work in war-torn countries where abortion is illegal, are the only group with federally funded health insurance who don’t get coverage even in these limited, desperate circumstances.

Survivors of rape and domestic violence would benefit when the federal Crime Victims Fund gets a fourfold increase in funding—or, more accurately, when Congress allows the fund to spend four times more of the money it already receives in fines.

That means more money to test rape kit backlogs, and more funding for community organizations that help victims of domestic violence.

For military sexual assault victims, the Pentagon’s Sexual Assault Prevention and Response program would get $257 million in funding, including $25 million to expand the “special victims’ counsel” (SVC) program, which was created to give victims an ally in court and help them through the reporting process.

Advocates caution, however, that while the SVCs are a good step, they fall short of their promise—SVCs aren’t quite full lawyers for victims, they don’t have the same access to the documents a prosecutor does, and they often face retaliation in the same way victims do.

Funding for fiscal year 2015 will stay the same as it did last year for Title X domestic family planning programs ($286.5 million), international family planning programs ($610 million), and evidence-based teen pregnancy prevention ($101 million).

Women’s health advocates see these numbers as solid, if not necessarily ideal.

They wanted to see at least $300 million for Title X programs, which provide low-income women with key reproductive health-care services. The spending bill falls short of that.

Craig Lasher, director of U.S. government relations for Population Action International, told Rewire that the eventual goal for international family planning and reproductive health is $1 billion in U.S. funding, along with a near doubling of the current $35 million contribution to the United Nations Population Fund.

But with this Congress, advocates are just happy not to see cuts.

“The status quo is a good outcome in the current political environment,” Lasher said.

One funding tweak could create a “step backward,” Boonstra said, by increasing the number of abstinence-only sex education programs on the ground. Money that some states decline to use for these programs can now be reallocated to other states that use them, instead of being reallocated elsewhere or going back to the Treasury.

Another step backward is a $93 million cut (about 1.4 percent) to the Women, Infants, and Children (WIC) program, which gives food aid to low-income families.

But the status quo is already backwards, and has been for a long time, for groups who struggle to access safe and legal abortion care.

Lawmakers had little appetite this year to even consider lifting several long-standing prohibitions on federal funding for abortions, which hits women of color and poor women the hardest.

“We know that Latinas are more likely to need access to abortion, they’re less likely to be able to afford it, and they’re overrepresented among those who are Medicaid eligible,” Kimberly Inez McGuire, director of public affairs at the National Latina Institute for Reproductive Health, told Rewire.

Women of color are also the most affected by a measure that prevents the District of Columbia from spending its own money on helping low-income women get abortion coverage through Medicaid.

That provision went through in 2011, during the last budget negotiations debacle, when President Obama was quoted telling House Speaker John Boehner (R-OH), “John, I will give you D.C. abortion. I am not happy about it.”

This provision is “not only a denial of health care for women in D.C., it’s a double denial of self-determination,” Inez McGuire said.

NLIRH is part of a coalition of dozens of organizations organized under the “All Above All” campaign, which makes a social justice case for repealing the Hyde Amendment and other federal abortion funding restrictions.

The coalition is calling on President Obama to lift these restrictions in his next budget request to Congress, since it’s the last chance he will have to take a principled stand on the issue.

“Oftentimes with the budget process, it’s easy to get caught up in the numbers and forget we’re talking about people’s lives,” Inez McGuire said.