By John Reichard, CQ HealthBeat Editor
September 20, 2010 -- Health and Human Services Secretary Kathleen Sebelius said Monday that new regulations that take effect this week under the health care overhaul law will help stabilize a market that has been "in a bit of a death spiral."
Sebelius said the loss of eight million jobs during the economic downturn has "translated into a lot of health coverage losses" but that the other key factor behind the rise in the uninsured population to 50 million is that "the system was broken—fundamentally broken."
The secretary was asked at a forum, sponsored by the National Journal, whether the administration was making plans for next year in case Republicans gain a majority in Congress and they cut off funding for implementing the law.
Sebelius sidestepped the question, but she offered a response to statement made by House Minority Leader John A. Boehner, R-Ohio. Boehner said that he wouldn't spend "one dime" on the law; Sebelius said Boehner should have a conversation with his constituents. "Millions" of Americans in January will benefit from the new protections, Sebelius said, and Boehner needs to explain what the health care system will look like if Congress blocks implementation of the law.
Sebelius said this week's new regulations will protect consumers against insurer tactics to limit coverage, such as the cancellation of polities once they actually begin to file for health care benefits.
The regs also would end lifetime limits on insurance benefits, a protection that applies to a relatively small number of people but is crucial nonetheless, she said. Insurance enrollees who exceed the limits typically face serious illnesses requiring enormously costly treatment. "The people who are affected are really in life or death situations," she said.
The regs also will help another population facing lack of coverage: Young adults who are coming off their parents' coverage but who now under the law can stay insured up until age 26 if their insurer offers dependent coverage.
Children with preexisting medical conditions also will no longer be denied coverage, Sebelius said. She noted that some 2,000 employers and unions are now benefitting from a program created under the health law that helps pay medical expenses for enrollees in corporate or union retiree health plans. She also pointed to the availability of tax credits for small business to help pay for insurance coverage.
The major provisions of the law to help pay for coverage do not kick in until 2014 through subsidies and the availability of state-based exchanges that are supposed to foster competition to keep premiums affordable.
Sebelius acknowledged that rate increases "are likely to continue to be somewhat substantial," not because of the cost of complying with new regulations under the law but because marketplace cost trends "are fairly substantial."
The secretary suggested that insurer complaints that the regs will drive double-digit premium hikes are not credible, saying she typically encountered such claims as the Kansas state insurance commissioner when the legislature considered new mandates and that the assertions proved to be unfounded.