The Cost and Benefit of the Health Insurance Portability and Accountability Act
This was a multi-phase study that focused on groups that have been in the forefront of interacting with the population affected by the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and three HIPAA related provisions: MHPA (Mental Health Parity Act of 1996), NMPHA (Newborns and Mothers’ Health Protection Act of 1996) and WHCRA (Women’s Health and Cancer Rights Act of 1998). The groups, i.e., state agencies, consumer advocacy groups, or individual researchers, are being contacted and benefits identified. Since strategy for implementation of HIPAA was technically based on state insurance regulatory models, the project delineated and described similar and/or differing effects as this model was applied at the Federal level. Evaluation results led to assisting CMS in the planning of future endeavors in private health insurance regulation. This report presented findings on whether HIPAA, which was intended to be a positive influence on healthcare portability and availability, led to negative changes in the healthcare market. Specifically, the areas of premium fluctuations, modifications to coverage, employer waiting periods and job-lock were addressed. Conclusions, based on interviews with Departments of Insurance, health plans, employers, employer advocacy groups and review of human resource literature, include: (1) healthcare costs have increased markedly in the last several years; (2) it is difficult to attribute premium increases and benefit plan modifications directly to HIPAA, however, they are more prevalent in the small group marketplace, which has been more directly impacted by HIPAA’s guaranteed issue and pre-existing conditions limitations; and (3) among the changes most commonly seen are increases in cost sharing features such as deductibles and copays, and pharmaceutical coverage cost sharing.
FEDERAL CONTACT: James Fuller, 410-786-3365 PIC ID: 7420
PERFORMER: Arthur Andersen and Company, Washington, DC