Health Law and Policy Update
Headline of the week
Judge throws out challenge to health reform
A federal judge in Virginia on Tuesday threw out a challenge to the Affordable Care Act, ruling the law is constitutional and rejecting arguments that Congress doesn't have the power to require people to buy health insurance. The judge ruled the insurance coverage requirement to be a valid exercise of federal power under the Commerce Clause.
The lawsuit was filed by Liberty University in Lynchburg and five individuals. An official said the school will appeal the ruling. Kaiser Health News has a roundup of coverage of the case.
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What's new
Nobel Prize winner will study health care in Grand Junction
Systems established in Grand Junction for ensuring access to affordable, quality health care will be the subject of intensive study by a Nobel Prize-winning economist.
The Grand Junction Sentinel reports the city is one of three communities nationwide to be examined in the study by Elinor Ostrom, a professor at Indiana University. She was awarded the Nobel Prize in 2009.
Grand Junction has been the subject of considerable attention for systems its physicians, health insurance companies and others have developed to keep costs low while providing quality care, including a widely cited 2009 article in The New Yorker.
Administration adopts medical loss ratio rules
Health care consumers won an important victory Nov. 22 as the Obama Administration issued rules requiring insurance companies to spend 80 to 85 percent of premium dollars on medical care and health care quality improvement, while the rest can go to profits, advertising, administrative costs and other expenses.
The share of premium dollars spent on care is known as the medical loss ratio. Regulating that share was a key provision of national health reform, the Affordable Care Act. The new rules are part of the ongoing implementation of the Affordable Care Act.
Requiring insurance companies to spend most of their revenue on patient care is essential to ensuring health consumers get maximum value for their money. Many health consumer advocates, including the Colorado Center on Law and Policy, fought successfully for a tight definition of medical care expenses so it wouldn't include expenses that don't actually help patients. Read background on CCLP's website and a good summary of the regulations on the federal government's health care reform website.
Officials recover $3 billion from health care fraud investigations
The federal government has recovered $3 billion this year from health care fraud and other settlements. Most of the money came from fraud cases against drug companies. Kaiser Health News compiled a roundup of news coverage of the announcement.
Advancing the debate
How the Affordable Care Act helps contain costs
The cost of family health insurance premiums in Colorado increased 40 percent from 2003 to 2009, according to research released this week by The Commonwealth Fund.
In 2009, family premiums consumed 16.4 percent of median household income for family households where everyone was younger than 65. That's up from 14.5 percent of median household income in 2003. The average deductible for families in Colorado increased 69 percent during the same period.
The Affordable Care Act offers some hope for families struggling with rising costs, though, The Commonwealth Fund said.
"If reforms succeed in slowing premium growth by 1 percentage point annually in all states, by 2020 employers and families together will save $2,323 annually for family coverage, compared with projected trends," the organization said in a new paper.
The Affordable Care Act's net effects on state budgets
A new report by the Urban Institute and commissioned by First Focus details the net effects of the Affordable Care Act on state budgets by looking at the costs that states will incur through public program expansions but also at the potential savings that states can achieve by making certain policy decisions. The reports shows that by replacing state and local costs with federal dollars, states could show net budgetary savings of between $40.6 billion and $131.9 billion.
What's next
Health insurance exchange forum set for Dec. 8
A forum to discuss forming Colorado's health insurance exchange is set for 10 to 11:30 a.m. Wednesday, Dec. 8 at the Colorado Medical Society, 7351 E. Lowry Blvd., Denver.
The purpose will be to engage stakeholders in a discussion about the governance and structure of the exchange. It's an important opportunity for consumers and health advocates to provide input as the final exchange recommendations are drafted.
Health Law and Policy Update is issued weekly by the health staff of the Colorado Center on Law and Policy. Subscribe by e-mail or read previous editions.
Health Care Director
Elisabeth Arenales
Health Care Attorney
Adela Flores-Brennan
Special Counsel
Ed Kahn
Communications Director
Perry Swanson
Released Dec. 3, 2010