HHS issues rules on pre-existing conditions, wellness programs

Insurers finally got their long-awaited wish for more information on how to implement the reform law when the U.S. Department of Health & Human Services released proposed rules on three key pieces of the legislation.

On Tuesday, HHS issued a proposed rule prohibiting insurers from discriminating against individuals based on pre-existing conditions, gender, occupation or employer size or industry. But insurers will be allowed to raise premiums based on age, tobacco use, family size and geography. 

For example, insurers can increase premiums based on age, as long as they do so slightly every year. They can't, however, drastically increase premiums every five years or so. "It basically spreads out the increase … more smoothly," said Gary Cohen, director of the Center for Consumer Information and Insurance Oversight, according to The Hill's Healthwatch.

HHS also issued a proposed rule focusing on employment-based wellness programs, which requires insurers implement certain consumer protection measures to help prevent unfair practices. The rule requires that health-contingent wellness programs, which employers can provide to compel workers to achieve certain health goals, must offer reward qualifications that are adjusted to any individual who doesn't meet the set standard.

Under the proposed rule, HHS increased the maximum allowable reward, discount or penalty from 20 percent to 30 percent of the coverage cost. Plus, it raised maximum rewards to 50 percent for programs that help workers stop smoking, NBC News reported.

However, insurers still remain in the dark regarding several key issues, such as what the federal exchange will look like as well as how new taxes on premiums and medical devices will work. HHS officials said insurers can expect information on the federally-run exchange soon, noted Healthwatch.

To learn more:
- view the HHS proposed rules
- read The Hill's Healthwatch article
- check out the NBC News article