Healthcare Reform Update

Healthcare Reform Update

Follow along as the Affordable Care Act unfolds

By Genevieve M. Clavreul, RN, Ph.D.
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Back Story for Nurses New to This Column

On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act (ACA), a sweeping package of provisions we know as “healthcare reform.” Provisions go into effect during the next four years, with most changes taking place in 2014. Enactment of the law is complicated by mounting legal challenges.    

Stay tuned as we guide working nurses through the twists and turns, and provide an answer to the question: What is going on with healthcare reform?

 July 2013 Update

Pediatric Dental Care Coverage
On June 27, California Insurance Commissioner Dave Jones sent a letter to the board of Covered California, the state’s new health insurance exchange, formally asking the board to reverse its previous decision to prevent insurers and health plans from including pediatric dental coverage in individual market products sold through the California Health Benefit Exchange. In his letter, Jones warned that he believes the denial contravenes both state and federal law and will reduce children’s access to dental care.

Jones reminded the board that pediatric dental care was one of the essential health benefits specified in both the Affordable Care Act (ACA) and California’s essential health benefits law, which was passed by the Legislature and signed by Gov. Brown last year. The commissioner urged the board to change course and allow the inclusion of pediatric dental coverage before the insurance exchange begins enrollments later this year.

Hobby Lobby Says No to Birth Control

On June 28, a federal circuit court judge in Oklahoma issued a temporary restraining order preventing the federal government from levying fines that could total up to $1.3 million per day against Hobby Lobby Stores, Inc., for refusing to abide by part of the birth control coverage mandate of the ACA.

The Oklahoma-based arts and crafts chain Hobby Lobby and its affiliate, the Christian bookstore chain Mardel, claim that the mandate violates the owners’ constitutional rights by forcing them to offer insurance coverage for “abortion-inducing drugs and devices” that are against the owners’ religious beliefs. The owners say they do not object to most forms of artificial birth control, but have a religious objection to those that prevent implantation of a fertilized egg, such as intrauterine devices or the morning-after pill.
The case is Hobby Lobby Stores, et al v. Sebelius, et al, case number 12-6294 in the U.S. Court of Appeals for the Tenth Circuit.

Employer Insurance Mandate Delayed
On July 2, the Treasury Department announced that the White House would delay until 2015 the enforcement of a requirement for businesses to provide workers’ health insurance under the Affordable Care Act (ACA).

Under the ACA, most businesses with 50 or more full-time employees will be required to either provide employees with health insurance meeting certain minimum requirements or else pay a penalty of $2,000 per worker. The intention of the mandate is to discourage employers from dropping existing employee healthcare coverage and thereby forcing employees to buy their own subsidized insurance plans through an insurance exchange. The delay doesn’t affect the establishment of insurance exchanges or delay the 2014 implementation of the individual mandate requiring most Americans to purchase health insurance.

An unintended consequence of delaying the business requirement may be to make the determination of families’ eligibility for insurance subsidies dependent on the honor system, at least in 2014. According to Timothy Jost, a law professor at Washington and Lee School of Law in Lexington, Va., without the reporting requirements included in the employer mandate, the exchanges and the IRS will be unable to verify whether or not coverage is affordable, leaving it up to individual consumers to be honest about whether they do or do not qualify for subsidies.

June 2013 Update

Covered California Announces Plans and Rates for 2014

On May 23, Covered California (CoveredCA), the new health insurance exchange that was formed under the provisions of the Affordable Care Act (ACA), announced 13 health insurance plans that will participate in the state healthcare exchange.

The participants include a mix of large nonprofit and commercial plan leaders along with well-known Medi-Cal and regional plans. Some of the participating companies include Anthem Blue Cross, Kaiser Permanente and Blue Shield of California. Three large insurers have chosen to opt out of the exchange: Aetna, Cigna and United Healthcare.

The tentative selection of health plans is subject to a rate review by state regulators. CoveredCA estimates that the rates that have been submitted are between 2 and 29 percent lower than the 2013 average premium for small-employer health plans in California’s most-populous regions. CoveredCA also announced that the exchange will provide financial protections, such as a maximum out-of-pocket cost of $6,350, that exchange representatives say will dramatically reduce the chance of someone going bankrupt because of medical bills not covered by insurance.

CoveredCA Town Hall Meetings Continue

CoveredCA’s board members and executive director continue to hold stakeholder town hall meetings across the state. The meetings include an update on CoveredCA’s progress and current plans, an overview of outreach and community education strategies. To learn more or to sign up to attend, go to or call (800) 975-1141.

Background Checks for CoveredCA Employees and Vendors
There is a bill pending in the California Senate Committee on Health, chaired by Sen. Ed Hernandez, O.D. (D-24) to authorize CoveredCA to require and submit to the Department of Justice fingerprint images and related information about employees, prospective employees, contractors, subcontractors, volunteers or vendors in order to obtain criminal history information for those individuals. For more information about S.B. 509, including the complete text and the bill’s current status, click here.

Reductions in Medicaid Payments to Hospitals
On May 13, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule for cutting payments to hospitals that treat a disproportionate share of the poor. The cuts are part of the Affordable Care Act (ACA), which mandates annual reductions in Medicaid payments to such hospitals through fiscal year 2020. In exchange, increased insurance coverage options are expected to reduce levels of uncompensated care.

The proposed cuts would include a $500 million reduction for the 2014 fiscal year, with cuts expected to increase each subsequent year. CMS says it will seek public comments on the proposed cuts through July 12. Once finalized, the cuts would take effect on October 1 unless Congress enacts the president’s budget proposal to begin Medicaid reductions in fiscal year 2015 instead of fiscal year 2014.When implemented, the cuts may be detrimental to county-run hospitals.  


Value-Based Purchasing

On October 1, Medicare began implementing a new Value-Based Purchasing (VBP) program for hospitals and physicians. The VBP program offers financial incentives to hospitals to improve their quality of care: Hospitals that perform well will receive incentive payments, while hospitals whose performance is sub-par will have their Medicare payments reduced.

Hospitals will be required to publicly report their performance in specific areas, including practices for responding to heart attacks and heart failure, blood clots and pneumonia, as well as standards of surgical care, incidence of healthcare-associated infections and random surveys of patients’ perception of care.

Electronic Health Records

Also starting October 1, changes go into effect requiring health plans to adopt and implement rules for switching from paper recordkeeping to electronic health records, including measures to ensure security and patient confidentiality. The Obama administration says the use of electronic health records will cut administrative costs while helping to reduce medical errors.

Changes Next Year

Jan. 1, 2013 will see the following changes:
➢    Improvements to preventive healthcare coverage under Medicaid
➢    Federally funded increases in Medicaid payments for primary care doctors
➢    Establishment of a pilot program to pay healthcare providers a flat rate for each healthcare episode, rather than the current system of “a la carte” payments for individual medical services, encouraging providers to “bundle” services for greater cost effectiveness.

Starting next October, there will also be additional federal funding for the Children’s Health Insurance Program (CHIP). More on these changes to come in future healthcare updates.

Covered California

After considering many possible names (including “Avocado,” “Eureka” and “Condor”), the California Health Benefit Exchange recently selected “Covered California” as the official name of California’s new state-run health insurance exchange.

Starting next October, Covered California will help consumers and small businesses in 19 regions of California find an affordable health plan by pre-negotiating rates with insurers for plans in five tiers, grouped by cost and benefits offered. Plans for lower-income families will be partly subsidized by federal funds and are expected to begin in January 2014. The exchange’s executive director, Peter Lee, told the L.A. Times that more than 30 insurance providers are lining up for spots in the new insurance exchange, including Anthem Blue Cross, Blue Shield of California, Health Net Inc. and Kaiser Permanente.

Covered California will also oversee the expansion of Medi-Cal, California’s Medicaid program for low-income and disabled residents, which is expected to grow by almost 2 million people.September 2012 Update
New Study Finds “Alarming” Number of U.S. Doctors Close to Burnout
The massive influx of new patients that will result from the Affordable Care Act has barely begun, but a newly released study warns that our nation’s doctors are already overextended.

Conducted in 2011 by the Mayo Clinic in Rochester, Minn., the study surveyed 7,288 physicians across the United States. A startling 45.8 percent of doctors surveyed reported suffering at least one of the symptoms of job-related burnout defined by the 22-question Maslach Burnout Inventory. The most common symptom: emotional exhaustion, reported by 37.9 percent physicians surveyed.

The Mayo Clinic’s Tait D. Shanafelt, M.D., the study’s lead author, characterizes these results as “alarming.” He says the figures were substantially higher than the researchers anticipated based on past studies, suggesting that doctor burnout is becoming more prevalent. The study also found that symptoms of burnout are much more common among doctors than among other working adults. Of the 3,442 non-physician workers surveyed, 27.8 percent exhibited signs of burnout and only 23.5 percent reported suffering emotional exhaustion.

New Name Coming for California State Healthcare Exchange

California’s state healthcare exchange, presently known as the California Health Benefit Exchange, is looking for a new name. Starting in October 2013, the exchange will be responsible for connecting uninsured Californians with state-funded and/or federally subsidized insurance plans under the Affordable Care Act. Before that happens, exchange officials want to rebrand, concerned that the program’s existing name will be too confusing or too hard to remember for many consumers.

Some of the suggestions for a new name include CaliHealth, Eureka, Health Hub, Wellquest and Condor, but several of the exchange board members favor the name Avocado. California is a major producer of that fruit, which is believed to have a variety of health benefits. However, board members admit that they still need to do more consumer research. The official selection will be made before the end of the year. 

And the Verdict Is…
On June 28, 2012 the U.S. Supreme Court issued its decision on the constitutional challenge to the “individual mandate” provision of the Patient Protection and Affordable Care Act (the ACA, a.k.a.  “ObamaCare”). In a 5 to 4 vote, the high court denied a constitutional challenge of the individual mandate.

Jumping the Gun
There was some initial confusion about the decision, with many news agencies (including CNN and Fox News) reporting that the Supreme Court had struck down the individual mandate. This confusion arose from the high court’s initial statement that the Justices had determined that the individual mandate was not supported by the Commerce Clause, the justification that both President Obama and many members of Congress had cited as granting them the power to enact the mandate. 

After reading the full text of the opinion, it became clear that the high court had determined that the fee that would be assessed against those who chose to opt out of the individual mandate was not a penalty, but a tax. Because the court concluded that the penalty was in fact a tax, the high court upheld the constitutionality of the provision. The individual mandate and tax are both set to take effect in 2014.

Medicaid Ruling
However, the high court did rule that the Medicaid expansion provision of the ACA was unconstitutional. The Medicaid expansion would have required states to allow qualifying citizens (i.e., those whose annual income was no more than 133 percent of the Federal Poverty Index, currently about $30,000 per year for a family of four) to enroll in the states’ existing Medicaid programs. The federal government would have covered 100 percent of the cost of expanding those programs in 2013 and 90 percent in 2014.     The Supreme Court ruled that the federal government cannot withhold all Medicaid funds from states refusing to accept the Medicaid expansion, which represented a significant portion of the ACA’s goal of covering the uninsured.

Further Challenges
Finally, the Washington Post reports that 25 other challenges to the constitutionality of the ACA have not yet made it to the high court. At this time, it is unclear how many, if any, of those challenges will be heard by the Supreme Court, but if they are, we may see additional changes — or not.

The full impact of the ACA on physicians, nurses and other healthcare professionals is yet to be fully realized and remains the subject of much discussion. 

A plain-English explanation of the Supreme Court’s ruling on the official SCOTUS Blog

A chart published by the Washington Post detailing still-outstanding challenges to the constitutionality of the ACA


Catholic Institutions Sue Over Birth Control Regulatio
In late May, 43 Catholic institutions, including the University of Notre Dame, the Archdiocese of Washington and the Michigan Catholic Conference (to name a few) filed 12 separate lawsuits against the Department of Health and Human Services over recently released regulations requiring them to cover “drugs and procedures in direct conflict with religious beliefs.”

The lawsuits come in response to new regulations that would require religious institutions (through their insurers) to pay for coverage of abortion-inducing drugs, contraception and sterilization, regardless of the employers’ moral or religious objections.

Supreme Court Holds Hearings
From March 26-28, the Supreme Court held six hours of oral arguments on the Patient Protection and Affordable Care Act (PPACA), often referred to as “Obamacare.” These much anticipated and historic hearings brought a swell of supporters and protestors alike to Washington D.C.  Pundits, politicians, and the public-at-large all took turns parsing the various questions posed by the Justices and the responses from attorneys from both sides. In the end, the decision rests with the nine Supreme Court justices, who are expected to rule on the constitutionality of the PPACA in June.  This link provided by the Supreme Court ( provides a comprehensive look at the hearings as they occurred, along with various documents relatec to the case.

California Forges Ahead
Governor Brown has announced that regardless of whether the PPACA is upheld or struck down by the Supreme Court, California is poised to move forward with implementation of its own affordable care act plan.  More on this as it develops. 

The Supremes to Decide Before Election
In September, the Obama Administration filed a petition with the Supreme Court asking for a speedy ruling on the constitutionality of the Affordable Care Act (ACA). This request almost guarantees that the Court will hear at least one of the cases challenging the healthcare reform law before next year’s election. Which should make 2012 a very interesting year indeed.

Long-Term Care Too Costly

The Community Living Assistance Services and Support (CLASS) Act, a key component of the ACA, has fallen apart due to actuarial unsoundness. The CLASS Act would be funded by premiums and would pay enrollees $50 or more per day if they became too disabled to perform normal daily activities like eating and bathing.     

Employers who chose to participate would sign up their employees, who would then have the ability to opt out. The cash benefits could be applied to nursing-home care, but in an effort to encourage enrollees to stay in their own homes, payouts could cover such things as wheelchair ramps and wages for home healthcare aides.      

The CLASS Act was required by law to remain financially self-sustaining. However, the Health and Human Services Department was unable to devise a means of implementation that could both attract healthy participants and pay the minimum level of benefits.

Final Rules for ACOs Released

The Obama Administration released the final rules for Accountable Care Organizations (ACO). ACOs are partnerships of healthcare providers formed to reduce the cost of caring for Americans on Medicare while also boosting quality. ACOs that achieve these goals could share in any savings with the Medicare program. The model outlined by the Obama Administration would require participating groups of doctors, clinics and hospitals to take responsibility for managing the care of at least 5,000 Medicare patients.


Appeals Court Dismisses Virginia’s Challenge to Health Care Law

In a unanimous decision, the 4th U.S. Circuit Court of Appeals has overturned a lower court’s decision to declare the law unconstitutional, ruling that the state doesn’t have a right to bring a lawsuit.

This is the second appellate court ruling in favor of the government’s right to require individuals to buy health insurance or pay a penalty.  However, the court stopped short on ruling whether the individual mandate in the healthcare law is constitutional; it strictly examined Virginia’s right to sue. The court also dismissed a second lawsuit from Liberty University for the same reasons.

Another Court Ruling Against ACA

On Friday, August 12, the 11th Circuit Court of Appeals panel struck down the individual mandate, siding with 26 states that sued to block the law. The decision penned by Chief Judge Joel Dubina and Circuit Judge Frank Hull, found that “the individual mandate contained in the Act exceeds Congress’s enumerated commerce power. What Congress cannot do under the Commerce Clause is mandate that individuals enter into contracts with private insurance companies for the purchase of an expensive product from the time they are born until the time they die.” However, in the same ruling the justices did not invalidate the entire overhaul as unconstitutional.

New Rules for Birth Control and Other Women’s Health Services

This month, the Dept. of Health and Human Services  unveiled wide-ranging changes regarding healthcare  services for women. Under these new provisions, women will soon be able to get birth control pills, breast pumps, HIV tests and five other categories of preventive services without incurring a co-pay or other out-of-pocket insurance charges. The new guidelines go into effect by 2012. Federal officials estimate that as many as 34 million women 18 to 64 years old aren’t presently covered by such services.

The Supreme Court Will Rule Next Year

The Thomas More Law Center for Ann Arbor, Michigan, filed a suit, stating that Congress overstepped its authority in requiring Americans to purchase health insurance or pay financial penalties. Currently the Supreme Court is in recess and will not meet again until early fall. Thus the earliest this case (or other challenge to the Affordable Care Act) may be heard would be early in 2012. 

Federal Appeals Court Upholds Ruling

On June 29, a federal appeals court in Cincinnati upheld President Obama’s healthcare overhaul. This is the first ruling by a federal appeals court on the reform bill. The three-judge 6th U.S. Circuit Court of Appeals panel delivered an opinion, in which there were disagreements on some issues, but affirmed a Michigan federal judge’s earlier ruling that Congress can require Americans to have minimum insurance coverage.

Second Appellate Panel Hears Arguments

On June 1, three judges from the United States Court of Appeals for the Sixth Circuit in Cincinnati heard arguments on the second challenge to the healthcare reform law that has reached an appellate hearing.  The New York Times has reported that the randomly-selected Sixth Circuit panel includes two judges appointed by Republicans — Jeffrey S. Sutton, who was named by President George W. Bush, and Judge Graham, who was nominated by President Ronald Reagan to the Federal District Court in Ohio and is on temporary assignment to the appellate bench. The third judge, Boyce F. Martin Jr., was appointed by President Jimmy Carter, a Democrat.

States Request Waivers

Several states have requested waivers to parts of the ACA. In general, the requests have been to waive certain implementation requirements on the grounds that these requirements “may lead to the destabilization of the individual market.”  So far three states, New Hampshire, Maine and Nevada have been granted partial waivers. Five more states have waiver requests pending.

And while we’re on the subject of waivers. States haven’t been the only “entities” to request waivers from portions of the law.  According to the White House blog posting, 1,372 waivers have been granted to employers, health plans, and others in all 50 states. According the White House posting, these waivers apply only to annual limits; no other provision of the ACA is affected.  

Supreme Court Rejects Request

In late April, the U.S. Supreme Court rejected Virginia’s request that the Court to rule on the constitutionality of the ACA in an expedited hearing. Their ruling means that the lawsuit will move forward to the U.S. District Court for the Eastern District of Virginia. This appeal stems from a December ruling by a judge that the minimum coverage provision of the ACA is unconstitutional. That ruling has been put on hold, pending appeal.  

Rules Proposed for Acccountable Care Organizations (ACO)

On Thursday, March 31, the Obama Administration released rules for the much-anticipated Accountable Care Organization (ACO) models. ACOs are another way that groups of doctors and hospitals that enter into collaboration to treat Medicare patients will be reimbursed. ACOs are anticipated to save taxpayers hundreds of millions of dollars by helping patients stay healthier and avoid unnecessary complications.

There are fears that this new approach might provide an unfair advantage to larger systems — those that can afford computerized databases and other resources to coordinate care with hospitals and specialists for the management of care for at least 5,000 patients. To encourage participation, the federal government would the share savings that are generated from more coordinated care.

White House Appeals Decision

The Obama Administration has formally asked a federal appeals court in Atlanta to rule in favor of the sweeping healthcare reform law. The Justice Department filed its brief on Sunday, April 3 with the US Court of Appeals for the 11th Circuit over the key provision of the law that requires most Americans to obtain health insurance or face financial penalties. This is the provision that a Florida judge ruled unconstitutional on January 31, setting up the current appeal. A three-judge panel of the 11th Circuit will hear oral arguments on the case in June. 

States’ Rights

On Feb 28, 2011, President Obama announced that he supported changes to the 2010 healthcare law that would allow states to opt-out of certain provisions of the ACA. This new announcement appears to be a White House endorsement of a proposal introduced by a trio of senators late last year to offer increased flexibility to the nation’s governors.

The bill, sponsored by Senators Scott Brown (R-Mass.), Mary Landrieu (D-La.) and Ron Wyden (D-Ore.) would accelerate the provision in the law that would allow states to ask federal health officials for “innovation waivers.”

Congress must approve the change, and then Health and Human Services officials need to write rules defining specifically how states could meet the criteria for a waiver. Should Congress approve the change, states could apply for “innovation waivers” as early as 2014 instead of in 2017.

Recent Court Ruling

In the latest round, the controversial individual mandate is ruled constitutional. Senior Judge Gladys Kessler, U.S. District Court in Washington, D.C., threw out a lawsuit brought by five plaintiffs who were represented by the American Center for Law and Justice. So for those who are keeping track, that makes three courts that have upheld the ACA law (in whole or part) as constitutional, and two courts that have ruled the ACA law (in whole or part) unconstitutional.

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