I always thought that ping pong was a sport people played with paddles and a small ball. Some people even called it table tennis. Silly me. Now I know better. It looks increasingly likely that Congress will be playing ping pong with health reform.
After both the House and the Senate passed their own versions of health reform late in 2009, many presumed that each chamber would appoint representatives to a formal House-Senate conference committee. This committee would then iron out the differences between the two versions and come up with a final health reform bill to be voted on, yet again, by each chamber and then, at long last, sent to the President for his signature.
Now, it looks like Democratic leaders will not go the conference committee route and will instead “ping pong” (and not the game also known as table tennis). Under ping ponging, “the chambers send legislation back and forth to one another until they finally have an agreed-upon version of the bill. But even ping-ponging can take different forms and some people use the term generically to refer to any informal negotiations.” In fact, there could still be full negotiations but no formal conference.
At this point, you might be asking yourself what difference all of this makes. Formal conference committee or ping pong, who cares? Apparently, by ping ponging, instead of having a formal conference committee with all that entails, Democratic leadership can bypass a number of procedural hurdles and deliver a final bill to President Obama’s desk much more quickly than it otherwise could. In fact, some people suggest that it could all happen by late January/early February. We’ll have to wait and see about that but there’s no doubt that things could start to happen quickly now. Almost as fast as the game of ping pong itself.
Wednesday, January 6, 2010
Tuesday, January 5, 2010
Waiting Periods Limits
Among the provisions included in the Senate’s recently passed health reform bill is a limit on waiting periods for new employees to be able to enroll in a their employer’s health benefits coverage. The Senate provision, which is not included in the House bill, would prohibit group health plans from applying any waiting periods exceeding 90 days. It also would require employers with more than 50 employees to pay a $600 tax assessment for each full-time employee who must meet a waiting period of more than 60 days. Employers would have some time to comply with the waiting period limits provision, if it survives the Senate/House reconciliation process—the provision only would be effective for group health plans effective on or after Jan. 1, 2014.
Many employers currently apply waiting periods to minimize the expense involved in providing health insurance to short-term employees. According to the Kaiser Family Foundation’s Annual Employer Health Benefits 2009, waiting periods range from 30 days to six months, but the most common waiting period is 90 days and the average is just over two months.
However, 29% of workers face a waiting period of three months or more, Kaiser found. Some three-quarters of new workers face a waiting period, but new workers at small firms (those with fewer than 200 workers) are more likely than workers at larger firms to face a waiting period (80% versus 70%). Also more likely to face waiting periods are workers in the retail (93%), wholesale (88%), and, ironically, the health care industry (87%).
The longest “average” waiting periods (nearly three months) are found among workers in the agriculture/mining/construction, and the retail industries, while workers for state and local governments have the shortest average waiting period (less than two months). Workers at small firms are much more likely than workers at large firms to have a waiting period of three months (37% versus 12%), but 6% of workers at all firms have waiting periods of four or more months. But among workers at large firms, the largest proportion have either no waiting period (30% of firms) and 36% have one month.
After examining these statistics, it appears that the waiting period limits and penalties would have a greater effect on small employers that offer health insurance, an already small group, than on large employers. Small employers also are much more likely than large employers to buy health insurance, rather than to be self-insured—15% of workers iat small employers are covered under a self-funded plan, compared with 77% of workers at larger employers.
Whether or not the Senate’s waiting period provision survives in health reform, will it make much difference in extending coverage?
Many employers currently apply waiting periods to minimize the expense involved in providing health insurance to short-term employees. According to the Kaiser Family Foundation’s Annual Employer Health Benefits 2009, waiting periods range from 30 days to six months, but the most common waiting period is 90 days and the average is just over two months.
However, 29% of workers face a waiting period of three months or more, Kaiser found. Some three-quarters of new workers face a waiting period, but new workers at small firms (those with fewer than 200 workers) are more likely than workers at larger firms to face a waiting period (80% versus 70%). Also more likely to face waiting periods are workers in the retail (93%), wholesale (88%), and, ironically, the health care industry (87%).
The longest “average” waiting periods (nearly three months) are found among workers in the agriculture/mining/construction, and the retail industries, while workers for state and local governments have the shortest average waiting period (less than two months). Workers at small firms are much more likely than workers at large firms to have a waiting period of three months (37% versus 12%), but 6% of workers at all firms have waiting periods of four or more months. But among workers at large firms, the largest proportion have either no waiting period (30% of firms) and 36% have one month.
After examining these statistics, it appears that the waiting period limits and penalties would have a greater effect on small employers that offer health insurance, an already small group, than on large employers. Small employers also are much more likely than large employers to buy health insurance, rather than to be self-insured—15% of workers iat small employers are covered under a self-funded plan, compared with 77% of workers at larger employers.
Whether or not the Senate’s waiting period provision survives in health reform, will it make much difference in extending coverage?
Monday, January 4, 2010
COBRA extension: news and predictions
Happy New Year!
As we wait for House-Senate negotiations on health reform to progress, we have news to report and predictions to offer on the COBRA continuing health coverage front.
First, the news. In late December President Obama signed legislation that extends both the duration of the COBRA premium subsidy for unemployed workers already receiving the benefit, and the period of eligibility for newly unemployed workers to receive subsidized coverage. The extension, tucked inside the Defense Appropriations Act (P.L. 111-118) became law on December 19 (scroll down to page 65 for Sec. 1010).
Under the new law, assistance eligible individuals may now receive up to 15 months of subsidized coverage, rather than the nine months of coverage provided under the American Recovery and Reinvestment Act (P.L. 111-5) enacted in February 2009. The change applies retroactively, which means that those whose benefits began to expire at the end of November 2009 may maintain uninterrupted coverage, so long as they pay the reduced premium in a timely manner.
The Act also expands the definition of "assistance eligible individual" to include those terminated involuntarily during the period that begins September 1, 2008 and ends with February 28, 2010. Under the original law, the period of eligibility ended on December 31, 2009.
And now for the prediction.
As you may recall, the House bill (H.R. 3962) touts as an "immediate" reform an expansion of COBRA benefits to help bridge the transition to near-universal coverage. Under the proposal, former employees could continue coverage under their former employer's plan until the Health Insurance Exchange is up and running (either in 2013 or 2014). Note that there's no subsidy provided for these extended benefits--employees could still have to pay up to 102% of the premium.
Back in November, we were skeptical that this provision would make it into final legislation. No comparable Senate provision exists, and employers won't relish the expanded administrative duties the provision would bring.
Now, some are suggesting it's to the Democrat's advantage to load the final package with as many "immediate" reforms as possible. Why? New taxes to help defray the cost of the reforms kick in earlier than do the market reforms and subsidized coverage. Thus, as David Herszenhorn of the New York Times reports, "some Republicans have criticized the bill as akin to legislation on a layaway plan: pay now for benefits later."
So, will this political pressure help to push the COBRA expansion into the final package? We continue to predict that it won't. If it had a chance to get 60 votes in the Senate, presumably the provision would already be in the bill.
As we wait for House-Senate negotiations on health reform to progress, we have news to report and predictions to offer on the COBRA continuing health coverage front.
First, the news. In late December President Obama signed legislation that extends both the duration of the COBRA premium subsidy for unemployed workers already receiving the benefit, and the period of eligibility for newly unemployed workers to receive subsidized coverage. The extension, tucked inside the Defense Appropriations Act (P.L. 111-118) became law on December 19 (scroll down to page 65 for Sec. 1010).
Under the new law, assistance eligible individuals may now receive up to 15 months of subsidized coverage, rather than the nine months of coverage provided under the American Recovery and Reinvestment Act (P.L. 111-5) enacted in February 2009. The change applies retroactively, which means that those whose benefits began to expire at the end of November 2009 may maintain uninterrupted coverage, so long as they pay the reduced premium in a timely manner.
The Act also expands the definition of "assistance eligible individual" to include those terminated involuntarily during the period that begins September 1, 2008 and ends with February 28, 2010. Under the original law, the period of eligibility ended on December 31, 2009.
And now for the prediction.
As you may recall, the House bill (H.R. 3962) touts as an "immediate" reform an expansion of COBRA benefits to help bridge the transition to near-universal coverage. Under the proposal, former employees could continue coverage under their former employer's plan until the Health Insurance Exchange is up and running (either in 2013 or 2014). Note that there's no subsidy provided for these extended benefits--employees could still have to pay up to 102% of the premium.
Back in November, we were skeptical that this provision would make it into final legislation. No comparable Senate provision exists, and employers won't relish the expanded administrative duties the provision would bring.
Now, some are suggesting it's to the Democrat's advantage to load the final package with as many "immediate" reforms as possible. Why? New taxes to help defray the cost of the reforms kick in earlier than do the market reforms and subsidized coverage. Thus, as David Herszenhorn of the New York Times reports, "some Republicans have criticized the bill as akin to legislation on a layaway plan: pay now for benefits later."
So, will this political pressure help to push the COBRA expansion into the final package? We continue to predict that it won't. If it had a chance to get 60 votes in the Senate, presumably the provision would already be in the bill.
