Interim Final Rules for Group Health Plans and Health Insurance Issuers Relating to Coverage of Preventive Services Under the Patient Protection and Affordable Care Act, 41726-41760 [2010-17242]
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Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
(b) The additive is used or intended
for use as a feed acidifying agent, to
lower the pH, in complete swine feeds
at levels not to exceed 1.2 percent of the
complete feed.
(c) To assure safe use of the additive,
in addition to the other information
required by the Federal Food, Drug, and
Cosmetic Act (the act), the label and
labeling shall contain:
(1) The name of the additive.
(2) Adequate directions for use
including a statement that ammonium
formate must be uniformly applied and
thoroughly mixed into complete swine
feeds and that the complete swine feeds
so treated shall be labeled as containing
ammonium formate.
(d) To assure safe use of the additive,
in addition to the other information
required by the act and paragraph (c) of
this section, the label and labeling shall
contain:
(1) Appropriate warnings and safety
precautions concerning ammonium
formate (37 percent ammonium salt of
formic acid and 62 percent formic acid).
(2) Statements identifying ammonium
formate in formic acid (37 percent
ammonium salt of formic acid and 62
percent formic acid) as a corrosive and
possible severe irritant.
(3) Information about emergency aid
in case of accidental exposure as
follows:
(i) Statements reflecting requirements
of applicable sections of the Superfund
Amendments and Reauthorization Act
(SARA), and the Occupational Safety
and Health Administration’s (OSHA)
human safety guidance regulations.
(ii) Contact address and telephone
number for reporting adverse reactions
or to request a copy of the Material
Safety Data Sheet (MSDS).
Dated: July 14, 2010.
Tracey H. Forfa,
Acting Director, Center for Veterinary
Medicine.
[FR Doc. 2010–17565 Filed 7–16–10; 8:45 am]
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BILLING CODE 4160–01–S
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
[TD 9493]
RIN 1545–BJ60
DEPARTMENT OF LABOR
Employee Benefits Security
Administration
29 CFR Part 2590
RIN 1210–AB44
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
[OCIIO–9992–IFC]
45 CFR Part 147
RIN 0938–AQ07
Interim Final Rules for Group Health
Plans and Health Insurance Issuers
Relating to Coverage of Preventive
Services Under the Patient Protection
and Affordable Care Act
AGENCIES: Internal Revenue Service,
Department of the Treasury; Employee
Benefits Security Administration,
Department of Labor; Office of
Consumer Information and Insurance
Oversight, Department of Health and
Human Services.
ACTION: Interim final rules with request
for comments.
SUMMARY: This document contains
interim final regulations implementing
the rules for group health plans and
health insurance coverage in the group
and individual markets under
provisions of the Patient Protection and
Affordable Care Act regarding
preventive health services.
DATES: Effective date. These interim
final regulations are effective on
September 17, 2010.
Comment date. Comments are due on
or before September 17, 2010.
Applicability dates. These interim
final regulations generally apply to
group health plans and group health
insurance issuers for plan years
beginning on or after September 23,
2010. These interim final regulations
generally apply to individual health
insurance issuers for policy years
beginning on or after September 23,
2010.
Written comments may be
submitted to any of the addresses
specified below. Any comment that is
submitted to any Department will be
ADDRESSES:
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shared with the other Departments.
Please do not submit duplicates.
All comments will be made available
to the public. WARNING: Do not
include any personally identifiable
information (such as name, address, or
other contact information) or
confidential business information that
you do not want publicly disclosed. All
comments are posted on the Internet
exactly as received, and can be retrieved
by most Internet search engines. No
deletions, modifications, or redactions
will be made to the comments received,
as they are public records. Comments
may be submitted anonymously.
Department of Labor. Comments to
the Department of Labor, identified by
RIN 1210–AB44, by one of the following
methods:
• Federal eRulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• E-mail: EOHPSCA2713.EBSA@dol.gov.
• Mail or Hand Delivery: Office of
Health Plan Standards and Compliance
Assistance, Employee Benefits Security
Administration, Room N–5653, U.S.
Department of Labor, 200 Constitution
Avenue, NW., Washington, DC 20210,
Attention: RIN 1210–AB44.
Comments received by the
Department of Labor will be posted
without change to https://
www.regulations.gov and https://
www.dol.gov/ebsa, and available for
public inspection at the Public
Disclosure Room, N–1513, Employee
Benefits Security Administration, 200
Constitution Avenue, NW., Washington,
DC 20210.
Department of Health and Human
Services. In commenting, please refer to
file code OCIIO–9992–IFC. Because of
staff and resource limitations, we cannot
accept comments by facsimile (FAX)
transmission.
You may submit comments in one of
four ways (please choose only one of the
ways listed):
1. Electronically. You may submit
electronic comments on this regulation
to https://www.regulations.gov. Follow
the instructions under the ‘‘More Search
Options’’ tab.
2. By regular mail. You may mail
written comments to the following
address ONLY: Office of Consumer
Information and Insurance Oversight,
Department of Health and Human
Services, Attention: OCIIO–9992–IFC,
P.O. Box 8016, Baltimore, MD 21244–
1850.
Please allow sufficient time for mailed
comments to be received before the
close of the comment period.
3. By express or overnight mail. You
may send written comments to the
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Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
following address ONLY: Office of
Consumer Information and Insurance
Oversight, Department of Health and
Human Services, Attention: OCIIO–
9992–IFC, Mail Stop C4–26–05, 7500
Security Boulevard, Baltimore, MD
21244–1850.
4. By hand or courier. If you prefer,
you may deliver (by hand or courier)
your written comments before the close
of the comment period to either of the
following addresses:
a. For delivery in Washington, DC—
Office of Consumer Information and
Insurance Oversight, Department of
Health and Human Services, Room 445–
G, Hubert H. Humphrey Building, 200
Independence Avenue, SW.,
Washington, DC 20201.
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(Because access to the interior of the Hubert
H. Humphrey Building is not readily
available to persons without Federal
government identification, commenters are
encouraged to leave their comments in the
OCIIO drop slots located in the main lobby
of the building. A stamp-in clock is available
for persons wishing to retain a proof of filing
by stamping in and retaining an extra copy
of the comments being filed.)
b. For delivery in Baltimore, MD—
Centers for Medicare & Medicaid
Services, Department of Health and
Human Services, 7500 Security
Boulevard, Baltimore, MD 21244–1850.
If you intend to deliver your
comments to the Baltimore address,
please call (410) 786–7195 in advance to
schedule your arrival with one of our
staff members.
Comments mailed to the addresses
indicated as appropriate for hand or
courier delivery may be delayed and
received after the comment period.
Submission of comments on
paperwork requirements. You may
submit comments on this document’s
paperwork requirements by following
the instructions at the end of the
‘‘Collection of Information
Requirements’’ section in this document.
Inspection of Public Comments. All
comments received before the close of
the comment period are available for
viewing by the public, including any
personally identifiable or confidential
business information that is included in
a comment. We post all comments
received before the close of the
comment period on the following Web
site as soon as possible after they have
been received: https://
www.regulations.gov. Follow the search
instructions on that Web site to view
public comments.
Comments received timely will also
be available for public inspection as
they are received, generally beginning
approximately three weeks after
publication of a document, at the
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headquarters of the Centers for Medicare
& Medicaid Services, 7500 Security
Boulevard, Baltimore, Maryland 21244,
Monday through Friday of each week
from 8:30 a.m. to 4 p.m. EST. To
schedule an appointment to view public
comments, phone 1–800–743–3951.
Internal Revenue Service. Comments
to the IRS, identified by REG–120391–
10, by one of the following methods:
• Federal eRulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Mail: CC:PA:LPD:PR (REG–120391–
10), room 5205, Internal Revenue
Service, P.O. Box 7604, Ben Franklin
Station, Washington, DC 20044.
• Hand or courier delivery: Monday
through Friday between the hours of 8
a.m. and 4 p.m. to: CC:PA:LPD:PR
(REG–120391–10), Courier’s Desk,
Internal Revenue Service, 1111
Constitution Avenue, NW., Washington
DC 20224.
All submissions to the IRS will be
open to public inspection and copying
in room 1621, 1111 Constitution
Avenue, NW., Washington, DC from 9
a.m. to 4 p.m.
FOR FURTHER INFORMATION CONTACT:
Amy Turner or Beth Baum, Employee
Benefits Security Administration,
Department of Labor, at (202) 693–8335;
Karen Levin, Internal Revenue Service,
Department of the Treasury, at (202)
622–6080; Jim Mayhew, Office of
Consumer Information and Insurance
Oversight, Department of Health and
Human Services, at (410) 786–1565.
Customer Service Information:
Individuals interested in obtaining
information from the Department of
Labor concerning employment-based
health coverage laws may call the EBSA
Toll-Free Hotline at 1–866–444–EBSA
(3272) or visit the Department of Labor’s
Web site (https://www.dol.gov/ebsa). In
addition, information from HHS on
private health insurance for consumers
can be found on the Centers for
Medicare & Medicaid Services (CMS)
Web site (https://www.cms.hhs.gov/
HealthInsReformforConsume/01_
Overview.as) and information on health
reform can be found at https://
www.healthreform.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The Patient Protection and Affordable
Care Act (the Affordable Care Act),
Public Law 111–148, was enacted on
March 23, 2010; the Health Care and
Education Reconciliation Act (the
Reconciliation Act), Public Law 111–
152, was enacted on March 30, 2010.
The Affordable Care Act and the
Reconciliation Act reorganize, amend,
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and add to the provisions of part A of
title XXVII of the Public Health Service
Act (PHS Act) relating to group health
plans and health insurance issuers in
the group and individual markets. The
term ‘‘group health plan’’ includes both
insured and self-insured group health
plans.1 The Affordable Care Act adds
section 715(a)(1) to the Employee
Retirement Income Security Act (ERISA)
and section 9815(a)(1) to the Internal
Revenue Code (the Code) to incorporate
the provisions of part A of title XXVII
of the PHS Act into ERISA and the
Code, and make them applicable to
group health plans, and health
insurance issuers providing health
insurance coverage in connection with
group health plans. The PHS Act
sections incorporated by this reference
are sections 2701 through 2728. PHS
Act sections 2701 through 2719A are
substantially new, though they
incorporate some provisions of prior
law. PHS Act sections 2722 through
2728 are sections of prior law
renumbered, with some, mostly minor,
changes.
Subtitles A and C of title I of the
Affordable Care Act amend the
requirements of title XXVII of the PHS
Act (changes to which are incorporated
into ERISA section 715). The
preemption provisions of ERISA section
731 and PHS Act section 2724 2
(implemented in 29 CFR 2590.731(a)
and 45 CFR 146.143(a)) apply so that the
requirements of part 7 of ERISA and
title XXVII of the PHS Act, as amended
by the Affordable Care Act, are not to be
‘‘construed to supersede any provision
of State law which establishes,
implements, or continues in effect any
standard or requirement solely relating
to health insurance issuers in
connection with group or individual
health insurance coverage except to the
extent that such standard or
requirement prevents the application of
a requirement’’ of the Affordable Care
Act. Accordingly, State laws that
impose on health insurance issuers
requirements that are stricter than those
imposed by the Affordable Care Act will
not be superseded by the Affordable
Care Act.
1 The term ‘‘group health plan’’ is used in title
XXVII of the PHS Act, part 7 of ERISA, and chapter
100 of the Code, and is distinct from the term
‘‘health plan,’’ as used in other provisions of title I
of the Affordable Care Act. The term ‘‘health plan’’
does not include self-insured group health plans.
2 Code section 9815 incorporates the preemption
provisions of PHS Act section 2724. Prior to the
Affordable Care Act, there were no express
preemption provisions in chapter 100 of the Code.
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Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
The Departments of Health and
Human Services, Labor, and the
Treasury (the Departments) are issuing
regulations in several phases
implementing the revised PHS Act
sections 2701 through 2719A and
related provisions of the Affordable Care
Act. The first phase in this series was
the publication of a Request for
Information relating to the medical loss
ratio provisions of PHS Act section
2718, published in the Federal Register
on April 14, 2010 (75 FR 19297). The
second phase was interim final
regulations implementing PHS Act
section 2714 (requiring dependent
coverage of children to age 26),
published in the Federal Register on
May 13, 2010 (75 FR 27122). The third
phase was interim final regulations
implementing section 1251 of the
Affordable Care Act (relating to status as
a grandfathered health plan), published
in the Federal Register on June 17, 2010
(75 FR 34538). The fourth phase was
interim final regulations implementing
PHS Act sections 2704 (prohibiting
preexisting condition exclusions), 2711
(regarding lifetime and annual dollar
limits on benefits), 2712 (regarding
restrictions on rescissions), and 2719A
(regarding patient protections),
published in the Federal Register on
June 28, 2010 (75 FR 37188). These
interim final regulations are being
published to implement PHS Act
section 2713 (relating to coverage for
preventive services). PHS Act section
2713 is generally effective for plan years
(in the individual market, policy years)
beginning on or after September 23,
2010, which is six months after the
March 23, 2010 date of enactment of the
Affordable Care Act. The
implementation of other provisions of
PHS Act sections 2701 through 2719A
will be addressed in future regulations.
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II. Overview of the Regulations: PHS
Act Section 2713, Coverage of
Preventive Health Services (26 CFR
54.9815–2713T, 29 CFR 2590.715–2713,
45 CFR 147.130)
Section 2713 of the PHS Act, as added
by the Affordable Care Act, and these
interim final regulations require that a
group health plan and a health
insurance issuer offering group or
individual health insurance coverage
provide benefits for and prohibit the
imposition of cost-sharing requirements
with respect to:
• Evidence-based items or services
that have in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
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Force (Task Force) with respect to the
individual involved.3
• Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention
(Advisory Committee) with respect to
the individual involved. A
recommendation of the Advisory
Committee is considered to be ‘‘in
effect’’ after it has been adopted by the
Director of the Centers for Disease
Control and Prevention. A
recommendation is considered to be for
routine use if it appears on the
Immunization Schedules of the Centers
for Disease Control and Prevention.
• With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in the comprehensive guidelines
supported by the Health Resources and
Services Administration (HRSA).
• With respect to women, evidenceinformed preventive care and screening
provided for in comprehensive
guidelines supported by HRSA (not
otherwise addressed by the
recommendations of the Task Force).
The Department of HHS is developing
these guidelines and expects to issue
them no later than August 1, 2011.
The complete list of recommendations
and guidelines that are required to be
covered under these interim final
regulations can be found at https://
www.HealthCare.gov/center/
regulations/prevention.html. Together,
the items and services described in
these recommendations and guidelines
are referred to in this preamble as
‘‘recommended preventive services.’’
These interim final regulations clarify
the cost-sharing requirements when a
recommended preventive service is
provided during an office visit. First, if
a recommended preventive service is
billed separately (or is tracked as
individual encounter data separately)
from an office visit, then a plan or issuer
may impose cost-sharing requirements
with respect to the office visit. Second,
if a recommended preventive service is
3 Under PHS Act section 2713(a)(5), the Task
Force recommendations regarding breast cancer
screening, mammography, and prevention issued in
or around November of 2009 are not to be
considered current recommendations on this
subject for purposes of any law. Thus, the
recommendations regarding breast cancer
screening, mammography, and prevention issued by
the Task Force prior to those issued in or around
November of 2009 (i.e., those issued in 2002) will
be considered current until new recommendations
in this area are issued by the Task Force or appear
in comprehensive guidelines supported by the
Health Resources and Services Administration
concerning preventive care and screenings for
women.
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not billed separately (or is not tracked
as individual encounter data separately)
from an office visit and the primary
purpose of the office visit is the delivery
of such an item or service, then a plan
or issuer may not impose cost-sharing
requirements with respect to the office
visit. Finally, if a recommended
preventive service is not billed
separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is not the
delivery of such an item or service, then
a plan or issuer may impose costsharing requirements with respect to the
office visit. The reference to tracking
individual encounter data was included
to provide guidance with respect to
plans and issuers that use capitation or
similar payment arrangements that do
not bill individually for items and
services.
Examples in these interim final
regulations illustrate these provisions.
In one example, an individual receives
a cholesterol screening test, a
recommended preventive service,
during a routine office visit. The plan or
issuer may impose cost-sharing
requirements for the office visit because
the recommended preventive service is
billed as a separate charge. A second
example illustrates that treatment
resulting from a preventive screening
can be subject to cost-sharing
requirements if the treatment is not
itself a recommended preventive
service. In another example, an
individual receives a recommended
preventive service that is not billed as
a separate charge. In this example, the
primary purpose for the office visit is
recurring abdominal pain and not the
delivery of a recommended preventive
service; therefore the plan or issuer may
impose cost-sharing requirements for
the office visit. In the final example, an
individual receives a recommended
preventive service that is not billed as
a separate charge, and the delivery of
that service is the primary purpose of
the office visit. Therefore, the plan or
issuer may not impose cost-sharing
requirements for the office visit.
With respect to a plan or health
insurance coverage that has a network of
providers, these interim final
regulations make clear that a plan or
issuer is not required to provide
coverage for recommended preventive
services delivered by an out-of-network
provider. Such a plan or issuer may also
impose cost-sharing requirements for
recommended preventive services
delivered by an out-of-network
provider.
These interim final regulations
provide that if a recommendation or
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guideline for a recommended preventive
service does not specify the frequency,
method, treatment, or setting for the
provision of that service, the plan or
issuer can use reasonable medical
management techniques to determine
any coverage limitations. The use of
reasonable medical management
techniques allows plans and issuers to
adapt these recommendations and
guidelines to coverage of specific items
and services where cost sharing must be
waived. Thus, under these interim final
regulations, a plan or issuer may rely on
established techniques and the relevant
evidence base to determine the
frequency, method, treatment, or setting
for which a recommended preventive
service will be available without costsharing requirements to the extent not
specified in a recommendation or
guideline.
The statute and these interim final
regulations clarify that a plan or issuer
continues to have the option to cover
preventive services in addition to those
required to be covered by PHS Act
section 2713. For such additional
preventive services, a plan or issuer may
impose cost-sharing requirements at its
discretion. Moreover, a plan or issuer
may impose cost-sharing requirements
for a treatment that is not a
recommended preventive service, even
if the treatment results from a
recommended preventive service.
The statute requires the Departments
to establish an interval of not less than
one year between when
recommendations or guidelines under
PHS Act section 2713(a) 4 are issued,
and the plan year (in the individual
market, policy year) for which coverage
of the services addressed in such
recommendations or guidelines must be
in effect. These interim final regulations
provide that such coverage must be
provided for plan years (in the
4 Section 2713(b)(1) refers to an interval between
‘‘the date on which a recommendation described in
subsection (a)(1) or (a)(2) or a guideline under
subsection (a)(3) is issued and the plan year with
respect to which the requirement described in
subsection (a) is effective with respect to the service
described in such recommendation or guideline.’’
While the first part of this statement does not
mention guidelines under subsection (a)(4), it
would make no sense to treat the services covered
under (a)(4) any differently than those in (a)(1),
(a)(2), and (a)(3). First, the same sentence refers to
‘‘the requirement described in subsection (a),’’
which would include a requirement under (a)(4).
Secondly, the guidelines under (a)(4) are from the
same source as those under (a)(3), except with
respect to women rather than infants, children and
adolescents; and other preventive services
involving women are addressed in (a)(1), so there
is no plausible policy rationale for treating them
differently. Third, without this clarification, it
would be unclear when such services would have
to be covered. These interim final regulations
accordingly apply the intervals established therein
to services under section 2713(a)(4).
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individual market, policy years)
beginning on or after the later of
September 23, 2010, or one year after
the date the recommendation or
guideline is issued. Thus,
recommendations and guidelines issued
prior to September 23, 2009 must be
provided for plan years (in the
individual market, policy years)
beginning on or after September 23,
2010. For the purpose of these interim
final regulations, a recommendation or
guideline of the Task Force is
considered to be issued on the last day
of the month on which the Task Force
publishes or otherwise releases the
recommendation; a recommendation or
guideline of the Advisory Committee is
considered to be issued on the date on
which it is adopted by the Director of
the Centers for Disease Control and
Prevention; and a recommendation or
guideline in the comprehensive
guidelines supported by HRSA is
considered to be issued on the date on
which it is accepted by the
Administrator of HRSA or, if applicable,
adopted by the Secretary of HHS. For
recommendations and guidelines
adopted after September 23, 2009,
information at https://
www.HealthCare.gov/center/
regulations/prevention.html will be
updated on an ongoing basis and will
include the date on which the
recommendation or guideline was
accepted or adopted.
Finally, these interim final regulations
make clear that a plan or issuer is not
required to provide coverage or waive
cost-sharing requirements for any item
or service that has ceased to be a
recommended preventive service.5
Other requirements of Federal or State
law may apply in connection with
ceasing to provide coverage or changing
cost-sharing requirements for any such
item or service. For example, PHS Act
section 2715(d)(4) requires a plan or
issuer to give 60 days advance notice to
an enrollee before any material
modification will become effective.
Recommendations or guidelines in
effect as of July 13, 2010 are described
in section V later in this preamble. Any
change to a recommendation or
guideline that has—at any point since
September 23, 2009—been included in
the recommended preventive services
will be noted at https://
www.HealthCare.gov/center/
regulations/prevention.html. As
described above, new recommendations
and guidelines will also be noted at this
site and plans and issuers need not
make changes to coverage and costsharing requirements based on a new
recommendation or guideline until the
first plan year (in the individual market,
policy year) beginning on or after the
date that is one year after the new
recommendation or guideline went into
effect. Therefore, by visiting this site
once per year, plans or issuers will have
straightforward access to all the
information necessary to determine any
additional items or services that must be
covered without cost-sharing
requirements, or to determine any items
or services that are no longer required
to be covered.
The Affordable Care Act gives
authority to the Departments to develop
guidelines for group health plans and
health insurance issuers offering group
or individual health insurance coverage
to utilize value-based insurance designs
as part of their offering of preventive
health services. Value-based insurance
designs include the provision of
information and incentives for
consumers that promote access to and
use of higher value providers,
treatments, and services. The
Departments recognize the important
role that value-based insurance design
can play in promoting the use of
appropriate preventive services. These
interim final regulations, for example,
permit plans and issuers to implement
designs that seek to foster better quality
and efficiency by allowing cost-sharing
for recommended preventive services
delivered on an out-of-network basis
while eliminating cost-sharing for
recommended preventive health
services delivered on an in-network
basis. The Departments are developing
additional guidelines regarding the
utilization of value-based insurance
designs by group health plans and
health insurance issuers with respect to
preventive benefits. The Departments
are seeking comments related to the
development of such guidelines for
value-based insurance designs that
promote consumer choice of providers
or services that offer the best value and
quality, while ensuring access to
critical, evidence-based preventive
services.
The requirements to cover
recommended preventive services
without any cost-sharing requirements
do not apply to grandfathered health
plans. See 26 CFR 54.9815–1251T, 29
CFR 2590.715–1251, and 45 CFR
147.140 (75 FR 34538, June 17, 2010).
5 For example, if a recommendation of the United
States Preventive Services Task Force is
downgraded from a rating of A or B to a rating of
C or D, or if a recommendation or guideline no
longer includes a particular item or service.
III. Interim Final Regulations and
Request for Comments
Section 9833 of the Code, section 734
of ERISA, and section 2792 of the PHS
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Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
Act authorize the Secretaries of the
Treasury, Labor, and HHS (collectively,
the Secretaries) to promulgate any
interim final rules that they determine
are appropriate to carry out the
provisions of chapter 100 of the Code,
part 7 of subtitle B of title I of ERISA,
and part A of title XXVII of the PHS Act,
which include PHS Act sections 2701
through 2728 and the incorporation of
those sections into ERISA section 715
and Code section 9815.
In addition, under Section 553(b) of
the Administrative Procedure Act (APA)
(5 U.S.C. 551 et seq.) a general notice of
proposed rulemaking is not required
when an agency, for good cause, finds
that notice and public comment thereon
are impracticable, unnecessary, or
contrary to the public interest. The
provisions of the APA that ordinarily
require a notice of proposed rulemaking
do not apply here because of the
specific authority granted by section
9833 of the Code, section 734 of ERISA,
and section 2792 of the PHS Act.
However, even if the APA were
applicable, the Secretaries have
determined that it would be
impracticable and contrary to the public
interest to delay putting the provisions
in these interim final regulations in
place until a full public notice and
comment process was completed. As
noted above, the preventive health
service provisions of the Affordable
Care Act are applicable for plan years
(in the individual market, policy years)
beginning on or after September 23,
2010, six months after date of
enactment. Had the Departments
published a notice of proposed
rulemaking, provided for a 60-day
comment period, and only then
prepared final regulations, which would
be subject to a 60-day delay in effective
date, it is unlikely that it would have
been possible to have final regulations
in effect before late September, when
these requirements could be in effect for
some plans or policies. Moreover, the
requirements in these interim final
regulations require significant lead time
in order to implement. These interim
final regulations require plans and
issuers to provide coverage for
preventive services listed in certain
recommendations and guidelines
without imposing any cost-sharing
requirements. Preparations presumably
would have to be made to identify these
preventive services. With respect to the
changes that would be required to be
made under these interim final
regulations, group health plans and
health insurance issuers subject to these
provisions have to be able to take these
changes into account in establishing
their premiums, and in making other
changes to the designs of plan or policy
benefits, and these premiums and plan
or policy changes would have to receive
necessary approvals in advance of the
plan or policy year in question.
Accordingly, in order to allow plans
and health insurance coverage to be
designed and implemented on a timely
basis, regulations must be published
and available to the public well in
advance of the effective date of the
requirements of the Affordable Care Act.
It is not possible to have a full notice
and comment process and to publish
final regulations in the brief time
between enactment of the Affordable
Care Act and the date regulations are
needed.
The Secretaries further find that
issuance of proposed regulations would
not be sufficient because the provisions
of the Affordable Care Act protect
significant rights of plan participants
and beneficiaries and individuals
covered by individual health insurance
policies and it is essential that
participants, beneficiaries, insureds,
plan sponsors, and issuers have
certainty about their rights and
responsibilities. Proposed regulations
are not binding and cannot provide the
necessary certainty. By contrast, the
interim final regulations provide the
public with an opportunity for
comment, but without delaying the
effective date of the regulations.
For the foregoing reasons, the
Departments have determined that it is
impracticable and contrary to the public
interest to engage in full notice and
comment rulemaking before putting
these interim final regulations into
effect, and that it is in the public interest
to promulgate interim final regulations.
IV. Economic Impact
Under Executive Order 12866 (58 FR
51735), a ‘‘significant’’ regulatory action
is subject to review by the Office of
Management and Budget (OMB).
Section 3(f) of the Executive Order
defines a ‘‘significant regulatory action’’
as an action that is likely to result in a
rule (1) having an annual effect on the
economy of $100 million or more in any
one year, or adversely and materially
affecting a sector of the economy,
productivity, competition, jobs, the
environment, public health or safety, or
State, local or tribal governments or
communities (also referred to as
‘‘economically significant’’); (2) creating
a serious inconsistency or otherwise
interfering with an action taken or
planned by another agency; (3)
materially altering the budgetary
impacts of entitlement grants, user fees,
or loan programs or the rights and
obligations of recipients thereof; or (4)
raising novel legal or policy issues
arising out of legal mandates, the
President’s priorities, or the principles
set forth in the Executive Order. OMB
has determined that this regulation is
economically significant within the
meaning of section 3(f)(1) of the
Executive Order, because it is likely to
have an annual effect on the economy
of $100 million in any one year.
Accordingly, OMB has reviewed these
rules pursuant to the Executive Order.
The Departments provide an assessment
of the potential costs, benefits, and
transfers associated with these interim
final regulations, summarized in the
following table.
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TABLE 1—ACCOUNTING TABLE (2011–2013)
Benefits:
Qualitative: By expanding coverage and eliminating cost sharing for the recommended preventive services, the Departments expect access and
utilization of these services to increase. To the extent that individuals increase their use of these services the Departments anticipate several
benefits: (1) prevention and reduction in transmission of illnesses as a result of immunization and screening of transmissible diseases; (2) delayed onset, earlier treatment, and reduction in morbidity and mortality as a result of early detection, screening, and counseling; (3) increased
productivity and fewer sick days; and (4) savings from lower health care costs. Another benefit of these interim final regulations will be to distribute the cost of preventive services more equitably across the broad insured population.
Costs:
Qualitative: New costs to the health care system result when beneficiaries increase their use of preventive services in response to the changes
in coverage and cost-sharing requirements of preventive services. The magnitude of this effect on utilization depends on the price elasticity of
demand and the percentage change in prices facing those with reduced cost sharing or newly gaining coverage.
Transfers:
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TABLE 1—ACCOUNTING TABLE (2011–2013)—Continued
Qualitative: Transfers will occur to the extent that costs that were previously paid out-of-pocket for certain preventive services will now be covered by group health plans and issuers under these interim final regulations. Risk pooling in the group market will result in sharing expected
cost increases across an entire plan or employee group as higher average premiums for all enrollees. However, not all of those covered will
utilize preventive services to an equivalent extent. As a result, these interim final regulations create a small transfer from those paying premiums in the group market utilizing less than the average volume of preventive services in their risk pool to those whose utilization is greater
than average. To the extent there is risk pooling in the individual market, a similar transfer will occur.
A. The Need for Federal Regulatory
Action
As discussed later in this preamble,
there is current underutilization of
preventive services, which stems from
three main factors. First, due to turnover
in the health insurance market, health
insurance issuers do not currently have
incentives to cover preventive services,
whose benefits may only be realized in
the future when an individual may no
longer be enrolled. Second, many
preventive services generate benefits
that do not accrue immediately to the
individual that receives the services,
making the individual less likely to
take-up, especially in the face of direct,
immediate costs. Third, some of the
benefits of preventive services accrue to
society as a whole, and thus do not get
factored into an individual’s decisionmaking over whether to obtain such
services.
These interim final regulations
address these market failures through
two avenues. First, they require
coverage of recommended preventive
services by non-grandfathered group
health plans and health insurance
issuers in the group and individual
markets, thereby overcoming plans’ lack
of incentive to invest in these services.
Second, they eliminate cost-sharing
requirements, thereby removing a
barrier that could otherwise lead an
individual to not obtain such services,
given the long-term and partially
external nature of benefits.
These interim final regulations are
necessary in order to provide rules that
plan sponsors and issuers can use to
determine how to provide coverage for
certain preventive health care services
without the imposition of cost sharing
in connection with these services.
B. PHS Act Section 2713, Coverage of
Preventive Health Services (26 CFR
54.9815–2713T, 29 CFR 2590.715–2713,
45 CFR 147.130)
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1. Summary
As discussed earlier in this preamble,
PHS Act section 2713, as added by the
Affordable Care Act, and these interim
final regulations require a group health
plan and a health insurance issuer
offering group or individual health
insurance coverage to provide benefits
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for and prohibit the imposition of costsharing requirements with respect to the
following preventive health services:
• Evidence-based items or services
that have in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force (Task Force). While these
guidelines will change over time, for the
purposes of this impact analysis, the
Departments utilized currently available
guidelines, which include blood
pressure and cholesterol screening,
diabetes screening for hypertensive
patients, various cancer and sexually
transmitted infection screenings, and
counseling related to aspirin use,
tobacco cessation, obesity, and other
topics.
• Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention
(Advisory Committee) with respect to
the individual involved.
• With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in the comprehensive guidelines
supported by the Health Resources and
Services Administration (HRSA).
• With respect to women, evidenceinformed preventive care and screening
provided for in comprehensive
guidelines supported by HRSA (not
otherwise addressed by the
recommendations of the Task Force).
The Department of HHS is developing
these guidelines and expects to issue
them no later than August 1, 2011.
2. Preventive Services
For the purposes of this analysis, the
Departments used the relevant
recommendations of the Task Force and
Advisory Committee and current HRSA
guidelines as described in section V
later in this preamble. In addition to
covering immunizations, these lists
include such services as blood pressure
and cholesterol screening, diabetes
screening for hypertensive patients,
various cancer and sexually transmitted
infection screenings, genetic testing for
the BRCA gene, adolescent depression
screening, lead testing, autism testing,
and oral health screening and
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counseling related to aspirin use,
tobacco cessation, and obesity.
3. Estimated Number of Affected
Entities
For purposes of the new requirements
in the Affordable Care Act that apply to
group health plans and health insurance
issuers in the group and individual
markets, the Departments have defined
a large group health plan as an employer
plan with 100 or more workers and a
small group plan as an employer plan
with less than 100 workers. The
Departments estimated that there are
approximately 72,000 large and 2.8
million small ERISA-covered group
health plans with an estimated 97.0
million participants in large group plans
and 40.9 million participants in small
group plans.6 The Departments estimate
that there are 126,000 governmental
plans with 36.1 million participants in
large plans and 2.3 million participants
in small plans.7 The Departments
estimate there are 16.7 million
individuals under age 65 covered by
individual health insurance policies.8
As described in the Departments’
interim final regulations relating to
status as a grandfathered health plan,9
the Affordable Care Act preserves the
ability of individuals to retain coverage
under a group health plan or health
insurance coverage in which the
individual was enrolled on March 23,
2010 (a grandfathered health plan).
Group health plans, and group and
individual health insurance coverage,
that are grandfathered health plans do
not have to meet the requirements of
these interim final regulations.
Therefore, only plans and issuers
offering group and individual health
insurance coverage that are not
grandfathered health plans will be
affected by these interim final
regulations.
6 All participant counts and the estimates of
individual policies are from the U.S. Department of
Labor, EBSA calculations using the March 2008
Current Population Survey Annual Social and
Economic Supplement and the 2008 Medical
Expenditure Panel Survey.
7 Estimate is from the 2007 Census of
Government.
8 US Census Bureau, Current Population Survey,
March 2009.
9 75 FR 34538 (June 17, 2010).
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Plans can choose to relinquish their
grandfather status in order to make
certain otherwise permissible changes to
their plans.10 The Affordable Care Act
provides plans with the ability to
maintain grandfathered status in order
to promote stability for consumers while
allowing plans and sponsors to make
reasonable adjustments to lower costs
and encourage the efficient use of
services. Based on an analysis of the
changes plans have made over the past
few years, the Departments expect that
more plans will choose to make these
changes over time and therefore the
number of grandfathered health plans is
expected to decrease. Correspondingly,
the number of plans and policies
affected by these interim final
regulations is likely to increase over
time. In addition, the number of
individuals receiving the benefits of the
Affordable Care Act is likely to increase
over time. The Departments’ mid-range
estimate is that 18 percent of large
employer plans and 30 percent of small
employer plans would relinquish
grandfather status in 2011, increasing
over time to 45 percent and 66 percent
respectively by 2013, although there is
substantial uncertainty surrounding
these estimates.11
Using the mid-range assumptions, the
Departments estimate that in 2011,
roughly 31 million people will be
enrolled in group health plans subject to
the prevention provisions in these
interim final regulations, growing to
approximately 78 million in 2013.12 The
mid-range estimates suggest that
approximately 98 million individuals
10 See
75 FR 34538 (June 17, 2010).
75 FR 34538 (June 17, 2010) for a detailed
description of the derivation of the estimates for the
percentages of grandfathered health plans. In brief,
the Departments used data from the 2008 and 2009
Kaiser Family Foundations/Health Research and
Educational Trust survey of employers to estimate
the proportion of plans that made changes in costsharing requirements that would have caused them
to relinquish grandfather status if those same
changes were made in 2011, and then applied a set
of assumptions about how employer behavior might
change in response to the incentives created by the
grandfather regulations to estimate the proportion
of plans likely to relinquish grandfather status. The
estimates of changes in 2012 and 2013 were
calculated by using the 2011 calculations and
assuming that an identical percentage of plan
sponsors will relinquish grandfather status in each
year.
12 To estimate the number of individuals covered
in grandfathered health plans, the Departments
extended the analysis described in 75 FR 34538,
and estimated a weighted average of the number of
employees in grandfathered health plans in the
large employer and small employer markets
separately, weighting by the number of employees
in each employer’s plan. Estimates for the large
employer and small employer markets were then
combined, using the estimates supplied above that
there are 133.1 million covered lives in the large
group market, and 43.2 million in the small group
market.
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11 See
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will be enrolled in grandfathered group
health plans in 2013, many of which
already cover preventive services (see
discussion of the extent of preventive
services coverage in employersponsored plans later in this preamble).
In the individual market, one study
estimated that 40 percent to 67 percent
of individual policies terminate each
year. Because all newly purchased
individual policies are not
grandfathered, the Departments expect
that a large proportion of individual
policies will not be grandfathered,
covering up to and perhaps exceeding
10 million individuals.13
However, not all of the individuals
potentially affected by these interim
final regulations will directly benefit
given the prevalence and variation in
insurance coverage today. State laws
will affect the number of entities
affected by all or some provision of
these interim final regulations, since
plans, policies, and enrollees in States
that already have certain requirements
will be affected to different degrees.14
For instance, 29 States require that
health insurance issuers cover most or
all recommended immunizations for
children.15 Of these 29 States, 18 States
require first-dollar coverage of
immunizations so that the insurers pay
for immunizations without a deductible
and 12 States exempt immunizations
from copayments (e.g., $5, $10, or $20
per vaccine) or coinsurance (e.g., 10
percent or 20 percent of charges). State
laws also require coverage of certain
other preventive health services. Every
State except Utah mandates coverage for
some type of breast cancer screening for
women. Twenty-eight States mandate
coverage for some cervical cancer
screening and 13 States mandate
coverage for osteoporosis screening.16
Estimation of the number of entities
immediately affected by some or all
provisions of these interim final
regulations is further complicated by the
fact that, although not all States require
insurance coverage for certain
preventive services, many health plans
13 Adele M. Kirk. The Individual Insurance
Market: A Building Block for Health Care Reform?
Health Care Financing Organization Research
Synthesis. May 2008.
14 Of note, State insurance requirements do not
apply to self-insured group health plans, whose
participants and beneficiaries make up 57 percent
of covered employees (in firms with 3 or more
employees) in 2009 according to a major annual
survey of employers due to ERISA preemption of
State insurance laws. See e.g., Kaiser Family
Foundation and Health Research and Education
Trust, Employer Health Benefits 2009 Annual
Survey (2009).
15 See e.g., American Academy of Pediatrics,
State Legislative Report (2009).
16 See Kaiser Family Foundation,
www.statehealthfacts.org.
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have already chosen to cover these
services. For example, most health plans
cover most childhood and some adult
immunizations contained in the
recommendations from the Advisory
Committee. A survey of small, medium
and large employers showed that 78
percent to 80 percent of their point of
service, preferred provider organization
(PPO), and health maintenance
organization (HMO) health plans
covered childhood immunizations and
57 percent to 66 percent covered
influenza vaccines in 2001.17 All 61
health plans (HMOs and PPOs)
responding to a 2005 America’s Health
Insurance Plans (AHIP) survey covered
childhood immunizations 18 in their
best-selling products and almost all
health plans (60 out of 61) covered
diphtheria-tetanus-pertussis vaccines
and influenza vaccines for adults.19 A
survey of private and public employer
health plans found that 84 percent
covered influenza vaccines in 2002–
2003.20
Similarly, many health plans already
cover preventive services today, but
there are differences in the coverage of
these services in the group and
individual markets. According to a 2009
survey of employer health benefits, over
85 percent of employer-sponsored
health insurance plans covered
preventive services without having to
meet a deductible.21 Coverage of
preventive services does vary slightly by
employer size, with large employers
being more likely to cover such services
than small employers.22 In contrast,
coverage of preventive services is less
prevalent and varies more significantly
in the individual market.23 For PPOs,
17 See e.g., Mary Ann Bondi et. al., ‘‘Employer
Coverage of Clinical Preventive Services in the
United States,’’ American Journal of Health
Promotion, 20(3), pp. 214–222 (2006).
18 The specific immunizations include: DTaP
(diphtheria and tetanus toxoids and acellular
Pertussis), Hib (Haemophilus influenza type b),
Hepatitis B, inactivated polio, influenza, MMR
(measles, mumps, and rubella), pneumococcal, and
varicella vaccine.
19 McPhillips-Tangum C., Rehm B., Hilton O.
‘‘Immunization practices and policies: A survey of
health insurance plans.’’ AHIP Coverage. 47(1), 32–
7 (2006).
20 See e.g., Matthew M. Davis et. al., ‘‘Benefits
Coverage for Adult Vaccines in EmployerSponsored Health Plans,’’ University of Michigan
for the CDC National Immunizations Program
(2003).
21 See e.g., Kaiser Family Foundation and Health
Research and Education Trust, Employer Health
Benefits 2009 Annual Survey (2009) available at
https://ehbs.kff.org/pdf/2009/7936.pdf.
22 See e.g., Mary Ann Bondi et. al., ‘‘Employer
Coverage of Clinical Preventive Services in the
United States,’’ American Journal of Health
Promotion, 20(3), pp. 214–222 (2006).
23 See e.g., Matthew M. Davis et. al., ‘‘Benefits
Coverage for Adult Vaccines in EmployerSponsored Health Plans,’’ University of Michigan
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41733
4. Benefits
The Departments anticipate that four
types of benefits will result from these
interim final regulations. First,
individuals will experience improved
health as a result of reduced
transmission, prevention or delayed
onset, and earlier treatment of disease.
Second, healthier workers and children
will be more productive with fewer
missed days of work or school. Third,
some of the recommended preventive
services will result in savings due to
lower health care costs. Fourth, the cost
of preventive services will be
distributed more equitably.
By expanding coverage and
eliminating cost sharing for
recommended preventive services, these
interim final regulations could be
expected to increase access to and
utilization of these services, which are
not used at optimal levels today.
Nationwide, almost 38 percent of adult
residents over 50 have never had a
colorectal cancer screening (such as a
sigmoidoscopy or a colonoscopy) 25 and
almost 18 percent of women over age 18
have not been screened for cervical
cancer in the past three years.26
Vaccination rates for childhood
vaccines are generally high due to State
laws requiring certain vaccinations for
children to enter school, but
recommended childhood vaccines that
are not subject to State laws and adult
vaccines have lower vaccination rates
(e.g., the meningococcal vaccination rate
among teenagers is 42 percent).27
Studies have shown that improved
coverage of preventive services leads to
expanded utilization of these services,28
which would lead to substantial benefits
as discussed further below.
In addition, these interim final
regulations limit preventive service
coverage under this provision to
services recommended by the Task
Force, Advisory Committee, and HRSA.
The preventive services given a grade of
A or B by the Task Force have been
determined by the Task Force to have at
least fair or good 29 evidence that the
preventive service improves important
health outcomes and that benefits
outweigh harms in the judgment of an
independent panel of private sector
experts in primary care and
prevention.30 Similarly, the mission of
the Advisory Committee is to provide
advice that will lead to a reduction in
the incidence of vaccine preventable
diseases in the United States, and an
increase in the safe use of vaccines and
related biological products. The
comprehensive guidelines for infants,
children, and adolescents supported by
HRSA are developed by
multidisciplinary professionals in the
relevant fields to provide a framework
for improving children’s health and
reducing morbidity and mortality based
on a review of the relevant evidence.
The statute and interim final regulations
limit the preventive services covered to
those recommended by the Task Force,
Advisory Committee, and HRSA
because the benefits of these preventive
services will be higher than others that
may be popular but unproven.
Research suggests significant health
benefits from a number of the
preventive services that would be newly
covered with no cost sharing by plans
and issuers under the statute and these
interim final regulations. A recent
article in JAMA stated, ‘‘By one account,
increasing delivery of just five clinical
preventive services would avert 100,000
deaths per year.’’ 31 These five services
are all items and services recommended
by the Task Force, Advisory Committee,
and/or the comprehensive guidelines
supported by HRSA. The National
Council on Prevention Priorities (NCPP)
estimated that almost 150,000 lives
could potentially be saved by increasing
the 2005 rate of utilization to 90 percent
for eight of the preventive services
recommended by the Task Force or
Advisory Committee.32 Table 2 shows
eight of the services and the number of
lives potentially saved if utilization of
preventive services were to increase to
90 percent.
for the CDC National Immunizations Program
(2003).
24 See Individual Health Insurance 2006–2007: A
Comprehensive Survey of Premiums, Availability,
and Benefits. Available at https://
www.ahipresearch.org/pdfs/
Individual_Market_Survey_December_2007.pdf.
25 This differs from the Task Force
recommendation that individuals aged 50–75
receive fecal occult blood testing, sigmoidoscopy, or
colonoscopy screening for colorectal cancer.
26 For Behavioral Risk Factor Surveillance System
Numbers see e.g. Centers for Disease Control and
Prevention (CDC). Behavioral Risk Factor
Surveillance System Survey Data. Atlanta, Georgia:
U.S. Department of Health and Human Services,
Centers for Disease Control and Prevention, (2008)
at https://apps.nccd.cdc.gov/BRFSS/
page.asp?cat=CC&yr=2008&state=UB#CC.
27 See https://www.cdc.gov/vaccines/stats-surv/
imz-coverage.htm#nis for vaccination rates.
28 See e.g., Jonathan Gruber, The Role of
Consumer Copayments for Health Care: Lessons
from the RAND Health Insurance Experiment and
Beyond, Kaiser Family Foundation (Oct. 2006). This
paper examines an experiment in which copays
randomly vary across several thousand individuals.
The author finds that individuals are sensitive to
prices for health services—i.e. as copays decline,
more services are demanded. See e.g., Sharon Long,
‘‘On the Road to Universal Coverage: Impacts of
Reform in Massachusetts At One Year,’’ Health
Affairs, Volume 27, Number 4 (June 2008). The
author investigated the case of Massachusetts,
where coverage of preventive services became a
requirement in 2007, and found that for individuals
under 300 percent of the poverty line, doctor visits
for preventive care increased by 6.1 percentage
points in the year after adoption, even after
controlling for observable characteristics.
Additionally, the incidence of individuals citing
cost as the reason for not receiving preventive
screenings declined by 2.8 percentage points from
2006 to 2007. In the Massachusetts case, these
preventive care services were not necessarily free;
therefore, economists would expect a higher
differential under these interim final rules because
of the price sensitivity of health care usage.
29 The Task Force defines good and fair evidence
as follows. Good: Evidence includes consistent
results from well-designed, well-conducted studies
in representative populations that directly assess
effects on health outcomes.
Fair: Evidence is sufficient to determine effects
on health outcomes, but the strength of the
evidence is limited by the number, quality or
consistency of the individual studies,
generalizability to routine practice or indirect
nature of the evidence on health outcomes. See
https://www.ahrq.gov/clinic/uspstf/
gradespre.htm#drec.
30 See https://www.ahrq.gov/clinic/uspstf/
gradespre.htm#drec for details of the Task Force
grading.
31 Woolf, Steven. A Closer Look at the Economic
Argument for Disease Prevention. JAMA
2009;301(5):536–538.
32 See National Commission on Prevention
Priorities. Preventive Care: A National Profile on
Use, Disparities, and Health Benefits. Partnership
for Prevention, August 2007 at https://
www.prevent.org/content/view/129/72/#citations
accessed on 6/22/2010. Lives saved were estimated
using models previously developed to rank clinical
preventive services. See Maciosek MV, Edwards
NM, Coffield AB, Flottemesch TJ, Nelson WW,
Goodman MJ, Rickey DA, Butani AB, Solberg LI.
Priorities among effective clinical preventive
services: methods. Am J Prev Med 2006; 31(1):90–
96.
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only 66.2 percent of single policies
purchased covered adult physicals,
while 94.1 percent covered cancer
screenings.24
In summary, the number of affected
entities depends on several factors, such
as whether a health plan retains its
grandfather status, the number of new
health plans, whether State benefit
requirements for preventive services
apply, and whether plans or issuers
voluntarily offer coverage and/or no cost
sharing for recommended preventive
services. In addition, participants,
beneficiaries, and enrollees in such
plans or health insurance coverage will
be affected in different ways: Some will
newly gain coverage for recommended
preventive services, while others will
have the cost sharing that they now pay
for such services eliminated. As such,
there is considerable uncertainty
surrounding estimation of the number of
entities affected by these interim final
regulations.
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TABLE 2.—LIVES SAVED FROM INCREASING UTILIZATION OF SELECTED PREVENTIVE SERVICES TO 90 PERCENT
Percent utilizing
preventive
service in
2005
Preventive service
Population group
Regular aspirin use ...................................................................
Smoking cessation advice and help to quit ..............................
Colorectal cancer screening .....................................................
Influenza vaccination .................................................................
Cervical cancer screening in the past 3 years .........................
Cholesterol screening ...............................................................
Breast cancer screening in the past 2 years ............................
Chlamydia screening .................................................................
Lives saved annually if percent
utilizing preventive service
increased to
90 percent
40
28
48
37
83
79
67
40
45,000
42,000
14,000
12,000
620
2,450
3,700
30,000
Men 40+ and women 50+ .......................
All adult smokers .....................................
Adults 50+ ................................................
Adults 50+ ................................................
Women 18–64 .........................................
Men 35+ and women 45+ .......................
Women 40+ .............................................
Women 16–25 .........................................
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Source: National Commission on Prevention Priorities, 2007.
Since financial barriers are not the
only reason for sub-optimal utilization
rates, population-wide utilization of
preventive services is unlikely to
increase to the 90 percent level assumed
in Table 2 as a result of these interim
final regulations. Current utilization of
preventive services among insured
populations varies widely, but the
Departments expect that utilization will
increase among those individuals in
plans affected by the regulation because
the provisions eliminate cost sharing
and require coverage for these services.
These interim final regulations are
expected to increase the take-up rate of
preventive services and are likely, over
time, to lead physicians to increase their
use of these services knowing that they
will be covered, and covered with zero
copayment. In the absence of data on
the elasticity of demand for these
specific services, it is difficult to know
precisely how many more patients will
use these services. Evidence from
studies comparing the utilization of
preventive services such as blood
pressure and cholesterol screening
between insured and uninsured
individuals with relatively high
incomes suggests that coverage
increases usage rates in a wide range
between three and 30 percentage points,
even among those likely to be able to
afford basic preventive services out-ofpocket.33 A reasonable assumption is
that the average increase in utilization
of these services will be modest,
perhaps on the order of 5 to 10
percentage points for some of them. For
services that are generally covered
without cost sharing in the current
market, the Departments would expect
minimal change in utilization.
33 The Commonwealth Fund. ‘‘Insurance Coverage
and the Receipt of Preventive Care.’’ 2005. https://
www.commonwealthfund.org/Content/
Performance-Snapshots/Financial-and-StructuralAccess-to-Care/Insurance-Coverage-and-Receipt-ofPreventive-Care.aspx.
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Preventive services’ benefits have also
been evaluated individually. Effective
cancer screening, early treatment, and
sustained risk reduction could reduce
the death rate due to cancer by 29
percent.34 Improved blood sugar control
could reduce the risk for eye disease,
kidney disease and nerve disease by 40
percent in people with Type 1 or Type
2 diabetes.35
Some recommended preventive
services have both individual and
public health value. Vaccines have
reduced or eliminated serious diseases
that, prior to vaccination, routinely
caused serious illnesses or deaths.
Maintaining high levels of
immunization in the general population
protects the un-immunized from
exposure to the vaccine-preventable
disease, so that individuals who cannot
receive the vaccine or who do not have
a sufficient immune response to the
vaccine to protect against the disease are
indirectly protected.36
A second type of benefit from these
interim final regulations is improved
workplace productivity and decreased
absenteeism for school children.
Numerous studies confirm that ill
health compromises worker output and
that health prevention efforts can
improve worker productivity. For
example, one study found that 69
million workers reported missing days
due to illness and 55 million workers
reported a time when they were unable
to concentrate at work because of their
own illness or a family member’s
34 Curry, Susan J., Byers, Tim, and Hewitt, Maria,
eds. 2003. Fulfilling the Potential of Cancer
Prevention and Early Detection. Washington, DC:
National Academies Press.
35 Centers for Disease Control and Prevention.
2010. Diabetes at a Glance. See https://www.cdc.gov/
chronicdisease/resources/publications/aag/pdf/
2010/diabetes_aag.pdf.
36 See Modern Infectious Disease Epidemiology
by Johan Giesecke 1994, Chapter 18, The
Epidemiology of Vaccination.
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illness.37 Together, labor time lost due
to health reasons represents lost
economic output totaling $260 billion
per year.38 Prevention efforts can help
prevent these types of losses. Studies
have also shown that reduced costsharing for medical services results in
fewer restricted-activity days at work,39
and increased access to health insurance
coverage improves labor market
outcomes by improving worker health.40
Thus, the expansion of benefits and the
elimination of cost sharing for
preventive services as provided in these
37 Health and Productivity Among U.S. Workers,
Karen Davis, Ph.D., Sara R. Collins, Ph.D., Michelle
M. Doty, Ph.D., Alice Ho, and Alyssa L. Holmgren,
The Commonwealth Fund, August 2005 https://
www.commonwealthfund.org/Content/
Publications/Issue-Briefs/2005/Aug/Health-andProductivity-Among-U-S-Workers.aspx.
38 Ibid.
39 See e.g., RAND, The Health Insurance
Experiment: A Classic RAND Study Speaks to the
Current Health Care Reform Debate, Rand Research
Brief, Number 9174 (2006), at
https://www.rand.org/pubs/research_briefs/2006/
RAND_RB9174.pdf and Janet Currie et al., ‘‘Has
Public Health Insurance for Older Children
Reduced Disparities in Access to Care and Health
Outcomes?’’, Journal of Health Economics, Volume
27, Issue 6, pages 1567–1581 (Dec. 2008). With
early childhood interventions, there appear to be
improved health outcomes in later childhood.
Analogously, health interventions in early
adulthood could have benefits for future
productivity.
40 In a RAND policy brief, the authors cite results
from the RAND Health Insurance Experiment in
which cost-sharing is found to correspond with
workers having fewer restricted-activity days—
evidence that free care for certain services may be
productivity enhancing. See e.g., RAND, The Health
Insurance Experiment: A Classic RAND Study
Speaks to the Current Health Care Reform Debate,
Rand Research Brief, Number 9174 (2006), at
https://www.rand.org/pubs/research_briefs/2006/
RAND_RB9174.pdf. See e.g. Janet Currie et. al., ‘‘Has
Public Health Insurance for Older Children
Reduced Disparities in Access to Care and Health
Outcomes?’’ Journal of Health Economics, Volume
27, Issue 6, pages 1567–1581 (Dec. 2008). With
early childhood interventions, there appears to be
improved health outcomes in later childhood.
Analogously, health interventions in early
adulthood could have benefits for future
productivity. Council of Economic Advisers. ‘‘The
Economic Case for Health Reform.’’ (2009).
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mstockstill on DSKH9S0YB1PROD with RULES
interim final regulations can be
expected to have substantial
productivity benefits in the labor
market.
Illnesses also contribute to increased
absenteeism among school children,
which could be avoided with
recommended preventive services. In
2006, 56 percent of students missed
between one and five days of school due
to illness, 10 percent missed between
six and ten days and five percent missed
11 or more days.41 Obesity in particular
contributes to missed school days: One
study from the University of
Pennsylvania found that overweight
children were absent on average 20
percent more than their normal-weight
peers.42 Studies also show that
influenza contributes to school
absenteeism, and vaccination can
reduce missed school days and
indirectly improve community health.43
These interim final regulations will
ensure that children have access to
preventive services, thus decreasing the
number of days missed due to illness.44
Similarly, regular pediatric care,
including care by physicians
specializing in pediatrics, can improve
child health outcomes and avert
preventable health care costs. For
example, one study of Medicaid
enrolled children found that when
children were up to date for their age on
their schedule of well-child visits, they
were less likely to have an avoidable
hospitalization at a later time.45
A third type of benefit from some
preventive services is cost savings.
Increasing the provision of preventive
services is expected to reduce the
incidence or severity of illness, and, as
a result, reduce expenditures on
treatment of illness. For example,
childhood vaccinations have generally
been found to reduce such expenditures
by more than the cost of the
vaccinations themselves and generate
considerable benefits to society.
Researchers at the Centers for Disease
41 Bloom B, Cohen RA. Summary health statistics
for U.S. children: National Health Interview Survey,
2006. Vital Health Stat 2007;10(234). Available at
https://www.cdc.gov/nchs/nhis.htm.
42 University of Pennsylvania 2007: https://
www.upenn.edu/pennnews/news/childhoodobesity-indicates-greater-risk-school-absenteeismuniversity-pennsylvania-study-revea.
43 Davis, Mollie M., James C. King, Ginny
Cummings, and Laurence S. Madger. ‘‘Countywide
School-Based Influenza Immunization: Direct and
Indirect Impact on Student Absenteeism.’’
Pediatrics 122.1 (2008).
44 Moonie, Sheniz, David A. Sterling, Larry Figgs,
and Mario Castro. ‘‘Asthma Status and Severity
Affects Missed School Days.’’ Journal of School
Health 76.1 (2006): 18–24.
45 Bye, ‘‘Effectiveness of Compliance with
Pediatric Preventative Care Guidelines Among
Medicaid Beneficiaries.’’
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41735
Control and Prevention (CDC) studying
the economic impact of DTaP
(diphtheria and tetanus toxoids and
acellular Pertussis), Td (tetanus and
diphtheria toxoids), Hib (Haemophilus
influenza type b), IPV (inactivated
poliovirus), MMR (measles, mumps and
rubella), Hepatitis B and varicella
routine childhood vaccines found that
every dollar spent on immunizations in
2001 was estimated to save $5.30 on
direct health care costs and $16.50 on
total societal costs of the diseases as
they are prevented or reduced (direct
health care associated with the diseases
averted were $12.1 billion and total
societal costs averted were $33.9
billion).46
A review of preventive services by the
National Committee on Prevention
Priorities found that, in addition to
childhood immunizations, two of the
recommended preventive services—
discussing aspirin use with high-risk
adults and tobacco use screening and
brief intervention—are cost-saving on
net.47 By itself, tobacco use screening
with a brief intervention was found to
save more than $500 per smoker.48
Another area where prevention could
achieve savings is obesity prevention
and reduction. Obesity is widely
recognized as an important driver of
higher health care expenditures.49 The
Task Force recommends children over
age six and adults be screened for
obesity and be offered or referred to
counseling to improve weight status or
promote weight loss. Increasing obesity
screening and referrals to counseling
should decrease obesity and its related
costs. If providers are able to proactively
identify and monitor obesity in child
patients, they may reduce the incidence
of adult health conditions that can be
expensive to treat, such as diabetes,
hypertension, and adult obesity.50 One
recent study estimated that a onepercentage-point reduction in obesity
among twelve-year-olds would save
$260.4 million in total medical
expenditures.51
A full quantification of the cost
savings from the extension of coverage
of preventive services in these interim
final regulations is not possible, but to
illustrate the potential savings, an
assessment of savings from obesity
reduction was conducted. According to
the CDC, in 2008, 34.2 percent of U.S.
adults and 16.9 percent of children were
obese (defined as having a body mass
index (BMI) of 30.0 or greater).52
Obesity is associated with increased risk
for coronary heart disease,
hypertension, stroke, type 2 diabetes,
several types of cancer, diminished
mobility, and social stigmatization.53 As
a result, obesity is widely recognized as
an important driver of higher health
care expenditures on an individual 54
and national level.55
As described below, the Departments’
analysis assumes that the utilization of
preventive services will increase when
they are covered with zero copayment,
and these interim final regulations are
expected to increase utilization of
dietary counseling services both among
people who currently have the service
covered with a copayment and among
people for whom the service is not
currently covered at all.
Data from the 2009 Kaiser Family
Foundation Employer Health Benefits
Survey shows that 73 percent of
employees with employer-sponsored
insurance from a small (< 200
employees) employer do not currently
have coverage for weight loss programs,
46 Fangjun Zhou, Jeanne Santoli, Mark L.
Messonnier, Hussain R. Yusuf, Abigail Shefer,
Susan Y. Chu, Lance Rodewald, Rafael Harpaz.
Economic Evaluation of the 7-Vaccine Routine
Childhood Immunization Schedule in the United
States. Archives of Pediatric and Adolescent
Medicine 2005; 159(12): 1136–1144. The estimates
of the cost savings are based on current
immunization levels. The incremental impact of
increasing immunization rates is likely to be
smaller, but still significant and positive.
47 Maciosek MV, Coffield AB, Edwards NM,
Coffield AB, Flottemesch TJ, Goodman MJ, Solberg
LI. Priorities among effective clinical preventive
services: Results of a Systematic Review and
Analysis. Am J Prev Med 2006; 31(1):52–61.
48 Solberg LI, Maciosek, MV, Edwards NM,
Khanchandani HS, and Goodman MJ. Repeated
tobacco-use screening and intevention in clinical
practice: Health impact and cost effectiveness.
American Journal of Preventive Medicine.
2006;31(1).
49 Congressional Budget Office. ‘‘Technological
Change and the Growth of Health Care Spending.’’
January 2008. Box 1, pdf p. 18. https://www.cbo.gov/
ftpdocs/89xx/doc8947/01-31-TechHealth.pdf.
50 ‘‘Working Group Report on Future Research
Directions in Childhood Obesity Prevention and
Treatment.’’ National Heart, Lung and Blood
Institute, National Institutes of Health, U.S.
Department of Health and Human Services (2007),
available at https://www.nhlbi.nih.gov/meetings/
workshops/child-obesity/index.htm.
51 Ibid.
52 Centers for Disease Control and Prevention.
‘‘Obesity and Overweight.’’ 2010. https://
www.cdc.gov/nchs/fastats/overwt.htm.
53 Agency for Healthcare Research and Quality
(AHRQ). ‘‘Screening for Obesity in Adults.’’
December 2003. https://www.ahrq.gov/clinic/
3rduspstf/obesity/obesrr.pdf.
54 Thorpe, Kenneth E. ‘‘The Future Costs of
Obesity: National and State Estimates of the Impact
of Obesity on Direct Health Care Expenses.’’
November 2009; McKinsey Global Institute.
‘‘Sample data suggest that obese adults can incur
nearly twice the annual health care costs of normalweight adults.’’ 2007.
55 Congressional Budget Office. ‘‘Technological
Change and the Growth of Health Care Spending.’’
January 2008. Box 1, pdf p. 18. https://www.cbo.gov/
ftpdocs/89xx/doc8947/01-31-TechHealth.pdf.
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compared to 38 percent at large firms.56
In the illustrative analysis below, the
share of individuals without weight loss
coverage in the individual market is
assumed to be equal to the share in the
small group market.
The size of the increase in the number
of individuals receiving dietary
counseling or other weight loss services
will be limited by current physician
practice patterns, in which relatively
few individuals who are obese receive
physician recommendations for dietary
counseling. In one study of patients at
an internal medicine clinic in the
Bronx, NY, approximately 15 percent of
obese patients received a
recommendation for dietary
counseling.57 Similarly, among
overweight and obese patients enrolled
in the Cholesterol Education and
Research Trial, approximately 15 to 20
percent were referred to nutrition
counseling.58
These interim final regulations are
expected to increase the take-up rate of
counseling among patients who are
referred to it, and may, over time, lead
physicians to increase their referral to
such counseling, knowing that it will be
covered, and covered without cost
sharing. The effect of these interim final
regulations is expected to be magnified
because of the many other public and
private sector initiatives dedicated to
combating the obesity epidemic.
In the absence of data on take-up of
counseling among patients who are
referred by their physicians, it is
difficult to know what fraction of the
estimated 15 percent to 20 percent of
patients who are currently referred to
counseling follow through on that
referral, or how that fraction will change
after coverage of these services is
expanded. A reasonable assumption is
that utilization of dietary counseling
among patients who are obese might
increase by five to 10 percentage points
as a result of these interim final
regulations. If physicians change their
behavior and increase the rate at which
they refer to counseling, the effect might
be substantially larger.
The share of obese individuals
without weight loss coverage is
56 Kaiser Family Foundation. 2009 Employer
Health Benefits Annual Survey. Public Use File
provided to CEA; documentation of statistical
analysis available upon request. See https://
ehbs.kff.org.
57 Davis NJ, Emerenini A, Wylie-Rosett J. ‘‘Obesity
management: physician practice patterns and
patient preference,’’ Diabetes Education. 2006 Jul–
Aug; 32(4):557–61.
58 Molly E. Waring, PhD, Mary B. Roberts, MS,
Donna R. Parker, ScD and Charles B. Eaton, MD,
MS. ‘‘Documentation and Management of
Overweight and Obesity in Primary Care,’’ The
Journal of the American Board of Family Medicine
22 (5): 544–552 (2009).
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estimated to be 29 percent.59 It is
assumed that obese individuals have
health care costs 39 percent above
average, based on a McKinsey Global
Institute analysis.60 The Task Force
noted that counseling interventions led
to sustained weight loss ranging from
four percent to eight percent of body
weight, although there is substantial
heterogeneity in results across
interventions, with many interventions
having little long-term effect.61
Assuming midpoint reduction of six
percent of body weight, the BMI for an
individual taking up such an
intervention would fall by six percent as
well, as height would remain constant.
Based on the aforementioned McKinsey
Global Institute analysis, a six percent
reduction in BMI for an obese
individual (from 32 to around 30, for
example) would result in a reduction in
health care costs of approximately five
percent. This parameter for cost
reduction is subject to considerable
uncertainty, given the wide range of
potential weight loss strategies with
varying degrees of impact on BMI, and
their interconnectedness with changes
in individual health care costs.
Multiplying the percentage reduction
in health care costs by the total
premiums of obese individuals newly
gaining obesity prevention coverage
allows for an illustrative calculation of
the total dollar reduction in premiums,
and dividing by total premiums for the
affected population allows for an
estimate of the reduction in average
premiums across the entire affected
population. Doing so results in a
potential private premium reduction of
0.05 percent to 0.1 percent from lower
health care costs due to a reduction in
obesity for enrollees in nongrandfathered plans. This does not
account for potential savings in
Medicaid, Medicare, or other health
programs.
A fourth benefit of these interim final
regulations will be to distribute the cost
of preventive services more equitably
across the broad insured population.
Some Americans in plans affected by
59 This estimate is constructed using a weighted
average obesity rate taking into account the share
of the population aged 0 to 19 and 20 to 74 and
their respective obesity rates, derived from Census
Bureau and Centers for Disease Control and
Prevention data. U.S. Census Bureau. ‘‘Current
Population Survey (CPS) Table Creator.’’ 2010.
https://www.census.gov/hhes/www/cpstc/
cps_table_creator.html. Centers for Disease Control
and Prevention. ‘‘Obesity and Overweight.’’ 2010.
https://www.cdc.gov/nchs/fastats/overwt.htm.
60 McKinsey Global Institute Analysis provided to
CEA.
61 Agency for Healthcare Research and Quality
(AHRQ). ‘‘Screening for Obesity in Adults.’’
December 2003. p. 4. https://www.ahrq.gov/clinic/
3rduspstf/obesity/obesrr.pdf.
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these regulations currently have no
coverage of certain recommended
preventive services, and pay for them
entirely out-of-pocket. For some
individuals who currently have no
coverage of certain recommended
preventive services, these interim final
regulations will result in a large savings
in out-of-pocket payments, and only a
small increase in premiums. Many other
Americans have limited coverage of
certain recommended preventive
services, with large coinsurance or
deductibles, and also make substantial
out-of-pocket payments to obtain
preventive services. Some with limited
coverage of preventive services will also
experience large savings as a result of
these interim final regulations.
Reductions in out-of-pocket costs are
expected to be largest among people in
age groups in which relatively
expensive preventive services are most
likely to be recommended.
5. Costs and Transfers
The changes in how plans and issuers
cover the recommended preventive
services resulting from these interim
final regulations will result in changes
in covered benefits and premiums for
individuals in plans and health
insurance coverage subject to these
interim final regulations. New costs to
the health system result when
beneficiaries increase their use of
preventive services in response to the
changes in coverage of preventive
services. Cost sharing, including
coinsurance, deductibles, and
copayments, divides the costs of health
services between the insurer and the
beneficiaries. The removal of cost
sharing increases the quantity of
services demanded by lowering the
direct cost of the service to consumers.
Therefore, the Departments expect that
the statute and these interim final
regulations will increase utilization of
the covered preventive services. The
magnitude of this effect on utilization
depends on the price elasticity of
demand.
Several studies have found that
individuals are sensitive to prices for
health services.62 Evidence that
consumers change their utilization of
preventive services is available from
CDC researchers who studied out-ofpocket costs of immunizations for
62 See e.g., Jonathan Gruber, The Role of
Consumer Copayments for Health Care: Lessons
from the RAND Health Insurance Experiment and
Beyond, Kaiser Family Foundation (Oct. 2006). This
paper examines an experiment in which copays
randomly vary across several thousand individuals.
The author finds that individuals are sensitive to
prices for health services—i.e., as copays decline,
more services are demanded.
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privately insured children up to age 5 in
families in Georgia in 2003, to find that
a one percent increase in out-of-pocket
costs for routine immunizations (DTaP,
IPV, MMR, Hib, and Hep B) was
associated with a 0.07 percent decrease
in utilization.63
Along with new costs of induced
utilization, there are transfers associated
with these interim final regulations. A
transfer is a change in who pays for the
services, where there is not an actual
change in the level of resources used.
For example, costs that were previously
paid out-of-pocket for certain preventive
services will now be covered by plans
and issuers under these interim final
regulations. Such a transfer of costs
could be expected to lead to an increase
in premiums.
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a. Estimate of Average Changes in
Health Insurance Premiums
The Departments assessed the impact
of eliminating cost sharing, increases in
services covered, and induced
utilization on the average insurance
premium using a model to evaluate
private health insurance plans against a
nationally representative population.
The model is based on the Medical
Expenditure Panel Survey data from
2004, 2005, and 2006 on household
spending on health care, which are
scaled to levels consistent with the CMS
projections of the National Health
Expenditure Accounts.64 This data is
combined with data from the Employer
Health Benefits Surveys conducted by
the Kaiser Family Foundation and
Health Research and Education Trust to
model a ‘‘typical PPO coverage’’ plan.
The model then allows the user to
assess changes in covered expenses,
benefits, premiums, and induced
utilization of services resulting from
changes in the characteristics of the
plan. The analysis of changes in
coverage is based on the average perperson covered expenses and insurance
benefits. The average covered expense is
the total charge for covered services;
insurance benefits are the part of the
covered expenses covered by the
insurer. The effect on the average
premium is then estimated based on the
percentage changes in the insurance
benefits and the distribution of the
individuals across individual and group
markets in non-grandfathered plans.
63 See e.g., Noelle-Angelique Molinari et al., ‘‘Outof-Pocket Costs of Childhood Immunizations: A
Comparison by Type of Insurance Plan,’’ Pediatrics,
120(5) pp. 148–156 (2006).
64 The National Health Expenditure Accounts
(NHEA) are the official estimates of total health care
spending in the United States. See https://
www.cms.gov/NationalHealthExpendData/
02_NationalHealthAccountsHistorical.asp.
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The Departments assume that the
percent increase for insurance benefits
and premiums will be the same. This is
based on two assumptions: (1) That
administrative costs included in the
premium will increase proportionally
with the increase in insurance benefits;
and (2) that the increases in insurance
benefits will be directly passed on to the
consumer in the form of higher
premiums. These assumptions bias the
estimates of premium changes upward.
Using this model, the Departments
assessed: (1) Changes in cost-sharing for
currently covered and utilized services,
(2) changes in services covered, and (3)
induced utilization of preventive
services. There are several additional
sources of uncertainty concerning these
estimates. First, there is no accurate,
granular data on exactly what baseline
coverage is for the particular preventive
services addressed in these interim final
regulations. Second, there is uncertainty
over behavioral assumptions related to
additional utilization that results from
reduced cost-sharing. Therefore, after
providing initial estimates, the
Departments provide a sensitivity
analysis to capture the potential range of
impacts of these interim final
regulations.
From the Departments’ analysis of the
Medical Expenditure Panel Survey
(MEPS) data, controlled to be consistent
with projections of the National Health
Expenditure Accounts, the average
person with employer-sponsored
insurance (ESI) has $264 in covered
expenses for preventive services, of
which $240 is paid by insurance, and
$24 is paid out-of-pocket.65 When
preventive services are covered with
zero copayment, the Departments expect
the average preventive benefit (holding
utilization constant) will increase by
$24. This is a 0.6 percent increase in
insurance benefits and premiums for
plans that have relinquished their
grandfather status. A similar, but larger
effect is expected in the individual
market because existing evidence
suggests that individual health
insurance policies generally have less
generous benefits for preventive services
than group health plans. However, the
evidence base for current coverage and
cost sharing for preventive services in
individual health insurance policies is
weaker than for group health plans,
making estimation of the increase in
average benefits and premiums in the
individual market highly uncertain.
65 The model does not distinguish between
recommended and non-recommended preventive
services, and so this likely represents an
overestimate of the insurance benefits for
preventive services.
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41737
For analyses of changes in covered
services, the Departments used the Blue
Cross/Blue Shield Standard (BC/BS)
plan offered through the Federal
Employees Health Benefits Program as
an average plan.66 Other analyses have
used the BC/BS standard option as an
average plan as it was designed to
reflect standard practice within
employer-sponsored health insurance
plans.67 BC/BS covers most of the
preventive services listed in the Task
Force and Advisory Committee
recommendations, and most of the
preventive services listed in the
comprehensive guidelines for infants,
children, and adolescents supported by
HRSA. Not covered by the BC/BS
Standard plan are the recommendations
for genetic testing for the BRCA gene,
adolescent depression screening,68 lead
testing, autism testing, and oral health
screening.69
The Departments estimated the
increase in benefits from newly covered
services by estimating the number of
new services that would be provided
times the cost of providing the services,
and then spread these new costs across
the total insured population. The
Departments estimated that adding
coverage for genetic screening and
depression screening would increase
insurance benefits an estimated 0.10
percent. Adding lead testing, autism
testing, and oral health screening would
increase insurance benefits by an
estimated 0.02 percent. This results in a
total average increase in insurance
benefits on these services of 0.12
percent, or just over $4 per insured
person. This increase represents a
mixture of new costs and transfers,
dependent on whether beneficiaries
previously would have purchased these
services on their own. It is also
important to remember that actual plan
66 The Blue Cross Blue Shield standard option
plan documentation is available online at https://
fepblue.org/benefitplans/standard-option/
index.html.
67 Frey A, Mika S, Nuzum R, and Schoen C.
‘‘Setting a National Minimum Standard for Health
Benefits: How do State Benefit Mandates Compare
with Benefits in Large-Group Plans?’’ Issue Brief.
Commonwealth Fund June 2009 available at
https://www.commonwealthfund.org/Content/
Publications/Issue-Briefs/2009/Jun/Setting-aNational-Minimum-Standard-for-HealthBenefits.aspx.
68 The Task Force recommends that women
whose family history is associated with an
increased risk for deleterious mutations in BRCA1
or BRCA2 genes be referred for genetic counseling
and evaluation for BRCA testing and screening of
adolescents (12–18 years of age) for major
depressive disorder (MDD) when systems are in
place to ensure accurate diagnosis, psychotherapy
(cognitive-behavioral or interpersonal), and followup.
69 Lead, autism, and oral health screening are
from the HRSA comprehensive guidelines.
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impacts will vary depending on baseline
benefit levels, and that grandfathered
health plans will not experience any
impact from these interim final
regulations. The Departments expect the
increase to be larger in the individual
market because coverage of preventive
services in the individual market is less
complete than coverage in the group
market, but as noted previously, the
evidence base for the individual market
is weaker than that of the group market,
making detailed estimates of the size of
this effect difficult and highly uncertain.
Actuaries use an ‘‘induction formula’’
to estimate the behavioral change in
response to changes in the relative
levels of coverage for health services.
For this analysis, the Departments used
the model to estimate the induced
demand (the increased use of preventive
services). The model uses a standard
actuarial formula for induction 1/
(1+alpha*P), where alpha is the
‘‘induction parameter’’ and P is the
average fraction of the cost of services
paid by the consumer. The induction
parameter for physician services is 0.7,
derived by the standard actuarial
formula that is generally consistent with
the estimates of price elasticity of
demand from the RAND Health
Insurance Experiment and other
economic studies.70 Removing cost
sharing for preventive services lowers
the direct cost to consumers of using
preventive services, which induces
additional utilization, estimated with
the model above to increase covered
expenses and benefits by approximately
$17, or 0.44 percent in insurance
benefits in group health plans. The
Departments expect a similar but larger
effect in the individual market, although
these estimates are highly uncertain.
The Departments calculated an
estimate of the average impact using the
information from the analyses described
above, using estimates of the number of
individuals in non-grandfathered health
plans in the group and individual
markets in 2011. The Departments
estimate that premiums will increase by
approximately 1.5 percent on average
for enrollees in non-grandfathered
plans. This estimate assumes that any
changes in insurance benefits will be
directly passed on to the consumer in
the form of changes in premiums. As
mentioned earlier, this assumption
biases the estimates of premium change
upward.
70 Standard
formula best described in ‘‘QuantityPrice Relationships in Health Insurance’’, Charles L
Trowbridge, Chief Actuary, Social Security
Administration (DHEW Publication No. (SSA)73–
11507, November 1972).
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b. Sensitivity analysis
As discussed previously, there is
substantial uncertainty associated with
the estimates presented above. To
address the uncertainty in the group
market, the Departments first varied the
estimated change to underlying benefits,
to address the particular uncertainty
behind the estimate of baseline coverage
of preventive services in the group
market. The estimate for the per person
annual increase in insurance benefits
from adding coverage for new services
is approximately $4. The Departments
considered the impact of a smaller and
larger addition in benefits of
approximately $2 and $6 per person. To
consider the impact of uncertainty
around the size of the behavioral change
(that is, the utilization of more services
when cost sharing is eliminated), the
Departments analyzed the impact on
insurance benefits if the behavioral
change were 15 percent smaller and 15
percent larger.
In the individual market, to
accommodate the greater uncertainty
relative to the group market, the
Departments considered the impact of
varying the increase in benefits resulting
from cost shifting due to the elimination
of cost sharing, in addition to varying
the cost of newly covered services and
behavioral change.
Combining results in the group and
individual markets for enrollees in nongrandfathered plans, the Departments’
low-end is a few tenths of a percent
lower than the mid-range estimate of
approximately 1.5 percent, and the
high-end estimate is a few tenths of a
percent higher. Grandfathered health
plans are not subject to these interim
final regulations and therefore would
not experience this premium change.
6. Alternatives Considered
Several provisions in these interim
final regulations involved policy
choices. One was whether to allow a
plan or issuer to impose cost sharing for
an office visit when a recommended
preventive service is provided in that
visit. Sometimes a recommended
preventive service is billed separately
from the office visit; sometimes it is not.
The Departments decided that the cost
sharing prohibition of these interim
final regulations applies to the specific
preventive service as recommended by
the guidelines. Therefore, if the
preventive service is billed separately
from the office visit, it is the preventive
service that has cost sharing waived, not
the entire office visit.
A second policy choice was if the
preventive service is not billed
separately from the office visit, whether
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these interim final regulations should
prohibit cost sharing for any office visit
in which any recommended preventive
service was administered, or whether
cost sharing should be prohibited only
when the preventive service is the
primary purpose of the office visit.
Prohibiting cost sharing for office visits
when any recommended preventive
service is provided, regardless of the
primary purpose of the visit, could lead
to an overly broad application of these
interim final regulations; for example, a
person who sees a specialist for a
particular condition could end up with
a zero copayment simply because his or
her blood pressure was taken as part of
the office visit. This could create
financial incentives for consumers to
request preventive services at office
visits that are intended for other
purposes in order to avoid copayments
and deductibles. The increased
prevalence of the application of zero
cost sharing would lead to increased
premiums compared with the chosen
option, without a meaningful additional
gain in access to preventive services.
A third issue involves health plans
that have differential cost sharing for
services provided by providers who are
in and out of their networks. These
interim final regulations provide that a
plan or issuer is not required to provide
coverage for recommended preventive
services delivered by an out-of-network
provider. The plan or issuer may also
impose cost sharing for recommended
preventive services delivered by an outof-network provider. The Departments
considered that requiring coverage by
out-of-network providers at no cost
sharing would result in higher
premiums for these interim final
regulations. Plans and issuers negotiate
allowed charges with in-network
providers as a way to promote effective,
efficient health care, and allowing
differences in cost sharing in- and outof-network enables plans to encourage
use of in-network providers. Allowing
zero cost sharing for out of network
providers could reduce providers’
incentives to participate in insurer
networks. The Departments decided that
permitting cost sharing for
recommended preventive services
provided by out-of-network providers is
the appropriate option to preserve
choice of providers for individuals,
while avoiding potentially larger
increases in costs and transfers as well
as potentially lower quality care.
C. Regulatory Flexibility Act—
Department of Labor and Department of
Health and Human Services
The Regulatory Flexibility Act (5
U.S.C. 601 et seq.) (RFA) imposes
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certain requirements with respect to
Federal rules that are subject to the
notice and comment requirements of
section 553(b) of the APA (5 U.S.C. 551
et seq.) and that are likely to have a
significant economic impact on a
substantial number of small entities.
Section 9833 of the Code, section 734 of
ERISA, and section 2792 of the PHS Act
authorize the Secretaries to promulgate
any interim final rules that they
determine are appropriate to carry out
the provisions of chapter 100 of the
Code, part 7 of subtitle B or title I of
ERISA, and part A of title XXVII of the
PHS Act, which include PHS Act
sections 2701 through 2728 and the
incorporation of those sections into
ERISA section 715 and Code section
9815.
Moreover, under Section 553(b) of the
APA, a general notice of proposed
rulemaking is not required when an
agency, for good cause, finds that notice
and public comment thereon are
impracticable, unnecessary, or contrary
to the public interest. These interim
final regulations are exempt from APA,
because the Departments made a good
cause finding that a general notice of
proposed rulemaking is not necessary
earlier in this preamble. Therefore, the
RFA does not apply and the
Departments are not required to either
certify that the rule would not have a
significant economic impact on a
substantial number of small entities or
conduct a regulatory flexibility analysis.
Nevertheless, the Departments
carefully considered the likely impact of
the rule on small entities in connection
with their assessment under Executive
Order 12866. Consistent with the policy
of the RFA, the Departments encourage
the public to submit comments that
suggest alternative rules that accomplish
the stated purpose of the Affordable
Care Act and minimize the impact on
small entities.
D. Special Analyses—Department of the
Treasury
Notwithstanding the determinations
of the Department of Labor and
Department of Health and Human
Services, for purposes of the Department
of the Treasury, it has been determined
that this Treasury decision is not a
significant regulatory action for
purposes of Executive Order 12866.
Therefore, a regulatory assessment is not
required. It has also been determined
that section 553(b) of the APA (5 U.S.C.
chapter 5) does not apply to these
interim final regulations. For the
applicability of the RFA, refer to the
Special Analyses section in the
preamble to the cross-referencing notice
of proposed rulemaking published
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elsewhere in this issue of the Federal
Register. Pursuant to section 7805(f) of
the Code, these temporary regulations
have been submitted to the Chief
Counsel for Advocacy of the Small
Business Administration for comment
on their impact on small businesses.
E. Paperwork Reduction Act:
Department of Labor, Department of the
Treasury, and Department of Health
and Human Services
These interim final regulations are not
subject to the requirements of the
Paperwork Reduction Act of 1980 (44
U.S.C. 3501 et seq.) because it does not
contain a ‘‘collection of information’’ as
defined in 44 U.S.C. 3502 (11).
F. Congressional Review Act
These interim final regulations are
subject to the Congressional Review Act
provisions of the Small Business
Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.) and have
been transmitted to Congress and the
Comptroller General for review.
G. Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act
of 1995 (Pub. L. 104–4) requires
agencies to prepare several analytic
statements before proposing any rules
that may result in annual expenditures
of $100 million (as adjusted for
inflation) by State, local and tribal
governments or the private sector. These
interim final regulations are not subject
to the Unfunded Mandates Reform Act
because they are being issued as interim
final regulations. However, consistent
with the policy embodied in the
Unfunded Mandates Reform Act, these
interim final regulations have been
designed to be the least burdensome
alternative for State, local and tribal
governments, and the private sector,
while achieving the objectives of the
Affordable Care Act.
H. Federalism Statement—Department
of Labor and Department of Health and
Human Services
Executive Order 13132 outlines
fundamental principles of federalism,
and requires the adherence to specific
criteria by Federal agencies in the
process of their formulation and
implementation of policies that have
‘‘substantial direct effects’’ on the States,
the relationship between the national
government and States, or on the
distribution of power and
responsibilities among the various
levels of government. Federal agencies
promulgating regulations that have
these federalism implications must
consult with State and local officials,
and describe the extent of their
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consultation and the nature of the
concerns of State and local officials in
the preamble to the regulation.
In the Departments’ view, these
interim final regulations have
federalism implications, because they
have direct effects on the States, the
relationship between the national
government and States, or on the
distribution of power and
responsibilities among various levels of
government. However, in the
Departments’ view, the federalism
implications of these interim final
regulations are substantially mitigated
because, with respect to health
insurance issuers, the Departments
expect that the majority of States will
enact laws or take other appropriate
action resulting in their meeting or
exceeding the Federal standards.
In general, through section 514,
ERISA supersedes State laws to the
extent that they relate to any covered
employee benefit plan, and preserves
State laws that regulate insurance,
banking, or securities. While ERISA
prohibits States from regulating a plan
as an insurance or investment company
or bank, the preemption provisions of
section 731 of ERISA and section 2724
of the PHS Act (implemented in 29 CFR
2590.731(a) and 45 CFR 146.143(a))
apply so that the HIPAA requirements
(including those of the Affordable Care
Act) are not to be ‘‘construed to
supersede any provision of State law
which establishes, implements, or
continues in effect any standard or
requirement solely relating to health
insurance issuers in connection with
group health insurance coverage except
to the extent that such standard or
requirement prevents the application of
a requirement’’ of a Federal standard.
The conference report accompanying
HIPAA indicates that this is intended to
be the ‘‘narrowest’’ preemption of State
laws. (See House Conf. Rep. No. 104–
736, at 205, reprinted in 1996 U.S. Code
Cong. & Admin. News 2018.) States may
continue to apply State law
requirements except to the extent that
such requirements prevent the
application of the Affordable Care Act
requirements that are the subject of this
rulemaking. State insurance laws that
are more stringent than the Federal
requirements are unlikely to ‘‘prevent
the application of’’ the Affordable Care
Act, and be preempted. Accordingly,
States have significant latitude to
impose requirements on health
insurance issuers that are more
restrictive than the Federal law.
In compliance with the requirement
of Executive Order 13132 that agencies
examine closely any policies that may
have federalism implications or limit
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the policy making discretion of the
States, the Departments have engaged in
efforts to consult with and work
cooperatively with affected State and
local officials, including attending
conferences of the National Association
of Insurance Commissioners and
consulting with State insurance officials
on an individual basis. It is expected
that the Departments will act in a
similar fashion in enforcing the
Affordable Care Act requirements.
Throughout the process of developing
these interim final regulations, to the
extent feasible within the specific
preemption provisions of HIPAA as it
applies to the Affordable Care Act, the
Departments have attempted to balance
the States’ interests in regulating health
insurance issuers, and Congress’ intent
to provide uniform minimum
protections to consumers in every State.
By doing so, it is the Departments’ view
that they have complied with the
requirements of Executive Order 13132.
Pursuant to the requirements set forth
in section 8(a) of Executive Order
13132, and by the signatures affixed to
these interim final regulations, the
Departments certify that the Employee
Benefits Security Administration and
the Centers for Medicare & Medicaid
Services have complied with the
requirements of Executive Order 13132
for the attached regulations in a
meaningful and timely manner.
V. Recommended Preventive Services
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The materials that follow list
recommended preventive services,
current as of July 14, 2010, that will
have to be covered without cost-sharing
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when delivered by an in-network
provider. In many cases, the
recommendations or guidelines went
into effect before September 23, 2009;
therefore the recommended services
must be covered under these interim
final regulations in plan years (in the
individual market, policy years) that
begin on or after September 23, 2010.
However, there are some services that
appear in the figure that are based on
recommendations or guidelines that
went into effect at some point later than
September 23, 2009. Those services do
not have to be covered under these
interim final regulations until plan years
(in the individual market, policy years)
that begin at some point later than
September 23, 2010. In addition, there
are a few recommendations and
guidelines that went into effect after
September 23, 2009 and are not
included in the figure. In both cases,
information at https://
www.HealthCare.gov/center/
regulations/prevention.html specifically
identifies those services and the
relevant dates. The materials at https://
www.HealthCare.gov/center/
regulations/prevention.html will be
updated on an ongoing basis, and will
contain the most current recommended
preventive services.
A. Recommendations of the United
States Preventive Services Task Force
(Task Force)
Recommendations of the Task Force
appear in a chart that follows. This chart
includes a description of the topic, the
text of the Task Force recommendation,
the grade the recommendation received
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(A or B), and the date that the
recommendation went into effect.
B. Recommendations of the Advisory
Committee On Immunization Practices
(Advisory Committee) That Have Been
Adopted by the Director of the Centers
for Disease Control and Prevention
Recommendations of the Advisory
Committee appear in four immunization
schedules that follow: A schedule for
children age 0 to 6 years, a schedule for
children age 7 to 18 years, a ‘‘catch-up’’
schedule for children, and a schedule
for adults. Immunization schedules are
issued every year, and the schedules
that appear here are the 2010 schedules.
The schedules contain graphics that
provide information about the
recommended age for vaccination,
number of doses needed, interval
between the doses, and (for adults)
recommendations associated with
particular health conditions. In addition
to the graphics, the schedules contain
detailed footnotes that provide further
information on each immunization in
the schedule.
C. Comprehensive Guidelines Supported
by the Health Resources and Services
Administration (HRSA) for Infants,
Children, and Adolescents
Comprehensive guidelines for infants,
children, and adolescents supported by
HRSA appear in two charts that follow:
The Periodicity Schedule of the Bright
Futures Recommendations for Pediatric
Preventive Health Care, and the
Uniform Panel of the Secretary’s
Advisory Committee on Heritable
Disorders in Newborns and Children.
BILLING CODE 4830–01–P; 4510–29–P; 4210–01–P
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VI. Statutory Authority
The Department of the Treasury
temporary regulations are adopted
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pursuant to the authority contained in
sections 7805 and 9833 of the Code.
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41756
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The Department of Labor interim final
regulations are adopted pursuant to the
authority contained in 29 U.S.C. 1027,
1059, 1135, 1161–1168, 1169, 1181–
1183, 1181 note, 1185, 1185a, 1185b,
1191, 1191a, 1191b, and 1191c; sec.
101(g), Pub. L. 104–191, 110 Stat. 1936;
sec. 401(b), Pub. L. 105–200, 112 Stat.
645 (42 U.S.C. 651 note); sec. 512(d),
Pub. L. 110–343, 122 Stat. 3881; sec.
1001, 1201, and 1562(e), Pub. L. 111–
148, 124 Stat. 119, as amended by Pub.
L. 111–152, 124 Stat. 1029; Secretary of
Labor’s Order 6–2009, 74 FR 21524
(May 7, 2009).
The Department of Health and Human
Services interim final regulations are
adopted pursuant to the authority
contained in sections 2701 through
2763, 2791, and 2792 of the PHS Act (42
USC 300gg through 300gg-63, 300gg-91,
and 300gg-92), as amended.
Kathleen Sebelius,
Secretary, Department of Health and Human
Services.
List of Subjects
§ 54.9815–2713T Coverage of preventive
health services (temporary).
26 CFR Part 54
Excise taxes, Health care, Health
insurance, Pensions, Reporting and
recordkeeping requirements.
29 CFR Part 2590
Continuation coverage, Disclosure,
Employee benefit plans, Group health
plans, Health care, Health insurance,
Medical child support, Reporting and
recordkeeping requirements.
45 CFR Part 147
Health care, Health insurance,
Reporting and recordkeeping
requirements, and State regulation of
health insurance.
Steven T. Miller,
Deputy Commissioner for Services and
Enforcement, Internal Revenue Service.
Approved: July 8, 2010
Michael F. Mundaca,
Assistant Secretary of the Treasury (Tax
Policy).
Signed this 9th day of July, 2010.
Phyllis C. Borzi,
Assistant Secretary, Employee Benefits
Security Administration, Department of
Labor.
Dated: July 9, 2010
Jay Angoff,
Director, Office of Consumer Information and
Insurance Oversight.
mstockstill on DSKH9S0YB1PROD with RULES
Dated: July 9, 2010.
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Chapter 1
Accordingly, 26 CFR Part 54 is
amended as follows:
■
PART 54—PENSION EXCISE TAXES
Paragraph 1. The authority citation
for part 54 is amended by adding an
entry for § 54.9815–2713T in numerical
order to read in part as follows:
■
Authority: 26 U.S.C. 7805. * * *
Section 54.9815–2713T also issued
under 26 U.S.C. 9833. * * *
Par. 2. Section 54.9815–2713T is
added to read as follows:
■
(a) Services—(1) In general. Beginning
at the time described in paragraph (b) of
this section, a group health plan, or a
health insurance issuer offering group
health insurance coverage, must provide
coverage for all of the following items
and services, and may not impose any
cost-sharing requirements (such as a
copayment, coinsurance, or deductible)
with respect to those items or services:
(i) Evidence-based items or services
that have in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force with respect to the individual
involved (except as otherwise provided
in paragraph (c) of this section);
(ii) Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention with
respect to the individual involved (for
this purpose, a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention is
considered in effect after it has been
adopted by the Director of the Centers
for Disease Control and Prevention, and
a recommendation is considered to be
for routine use if it is listed on the
Immunization Schedules of the Centers
for Disease Control and Prevention);
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Fmt 4700
Sfmt 4700
(iii) With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in comprehensive guidelines
supported by the Health Resources and
Services Administration; and
(iv) With respect to women, to the
extent not described in paragraph
(a)(1)(i) of this section, evidenceinformed preventive care and screenings
provided for in comprehensive
guidelines supported by the Health
Resources and Services Administration.
(2) Office visits—(i) If an item or
service described in paragraph (a)(1) of
this section is billed separately (or is
tracked as individual encounter data
separately) from an office visit, then a
plan or issuer may impose cost-sharing
requirements with respect to the office
visit.
(ii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is the delivery
of such an item or service, then a plan
or issuer may not impose cost-sharing
requirements with respect to the office
visit.
(iii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is not the
delivery of such an item or service, then
a plan or issuer may impose costsharing requirements with respect to the
office visit.
(iv) The rules of this paragraph (a)(2)
are illustrated by the following
examples:
Example 1. (i) Facts. An individual
covered by a group health plan visits an innetwork health care provider. While visiting
the provider, the individual is screened for
cholesterol abnormalities, which has in effect
a rating of A or B in the current
recommendations of the United States
Preventive Services Task Force with respect
to the individual. The provider bills the plan
for an office visit and for the laboratory work
of the cholesterol screening test.
(ii) Conclusion. In this Example 1, the plan
may not impose any cost-sharing
requirements with respect to the separately-
E:\FR\FM\19JYR1.SGM
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Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
mstockstill on DSKH9S0YB1PROD with RULES
billed laboratory work of the cholesterol
screening test. Because the office visit is
billed separately from the cholesterol
screening test, the plan may impose costsharing requirements for the office visit.
Example 2. (i) Facts. Same facts as
Example 1. As the result of the screening, the
individual is diagnosed with hyperlipidemia
and is prescribed a course of treatment that
is not included in the recommendations
under paragraph (a)(1) of this section.
(ii) Conclusion. In this Example 2, because
the treatment is not included in the
recommendations under paragraph (a)(1) of
this section, the plan is not prohibited from
imposing cost-sharing requirements with
respect to the treatment.
Example 3. (i) Facts. An individual
covered by a group health plan visits an innetwork health care provider to discuss
recurring abdominal pain. During the visit,
the individual has a blood pressure
screening, which has in effect a rating of A
or B in the current recommendations of the
United States Preventive Services Task Force
with respect to the individual. The provider
bills the plan for an office visit.
(ii) Conclusion. In this Example 3, the
blood pressure screening is provided as part
of an office visit for which the primary
purpose was not to deliver items or services
described in paragraph (a)(1) of this section.
Therefore, the plan may impose a costsharing requirement for the office visit
charge.
Example 4. (i) Facts. A child covered by a
group health plan visits an in-network
pediatrician to receive an annual physical
exam described as part of the comprehensive
guidelines supported by the Health
Resources and Services Administration.
During the office visit, the child receives
additional items and services that are not
described in the comprehensive guidelines
supported by the Health Resources and
Services Administration, nor otherwise
described in paragraph (a)(1) of this section.
The provider bills the plan for an office visit.
(ii) Conclusion. In this Example 4, the
service was not billed as a separate charge
and was billed as part of an office visit.
Moreover, the primary purpose for the visit
was to deliver items and services described
as part of the comprehensive guidelines
supported by the Health Resources and
Services Administration. Therefore, the plan
may not impose a cost-sharing requirement
with respect to the office visit.
(3) Out-of-network providers. Nothing
in this section requires a plan or issuer
that has a network of providers to
provide benefits for items or services
described in paragraph (a)(1) of this
section that are delivered by an out-ofnetwork provider. Moreover, nothing in
this section precludes a plan or issuer
that has a network of providers from
imposing cost-sharing requirements for
items or services described in paragraph
(a)(1) of this section that are delivered
by an out-of-network provider.
(4) Reasonable medical management.
Nothing prevents a plan or issuer from
using reasonable medical management
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15:50 Jul 16, 2010
Jkt 220001
techniques to determine the frequency,
method, treatment, or setting for an item
or service described in paragraph (a)(1)
of this section to the extent not specified
in the recommendation or guideline.
(5) Services not described. Nothing in
this section prohibits a plan or issuer
from providing coverage for items and
services in addition to those
recommended by the United States
Preventive Services Task Force or the
Advisory Committee on Immunization
Practices of the Centers for Disease
Control and Prevention, or provided for
by guidelines supported by the Health
Resources and Services Administration,
or from denying coverage for items and
services that are not recommended by
that task force or that advisory
committee, or under those guidelines. A
plan or issuer may impose cost-sharing
requirements for a treatment not
described in paragraph (a)(1) of this
section, even if the treatment results
from an item or service described in
paragraph (a)(1) of this section.
(b) Timing—(1) In general. A plan or
issuer must provide coverage pursuant
to paragraph (a)(1) of this section for
plan years that begin on or after
September 23, 2010, or, if later, for plan
years that begin on or after the date that
is one year after the date the
recommendation or guideline is issued.
(2) Changes in recommendations or
guidelines. A plan or issuer is not
required under this section to provide
coverage for any items and services
specified in any recommendation or
guideline described in paragraph (a)(1)
of this section after the recommendation
or guideline is no longer described in
paragraph (a)(1) of this section. Other
requirements of Federal or State law
may apply in connection with a plan or
issuer ceasing to provide coverage for
any such items or services, including
PHS Act section 2715(d)(4), which
requires a plan or issuer to give 60 days
advance notice to an enrollee before any
material modification will become
effective.
(c) Recommendations not current. For
purposes of paragraph (a)(1)(i) of this
section, and for purposes of any other
provision of law, recommendations of
the United States Preventive Services
Task Force regarding breast cancer
screening, mammography, and
prevention issued in or around
November 2009 are not considered to be
current.
(d) Effective/applicability date. The
provisions of this section apply for plan
years beginning on or after September
23, 2010. See § 54.9815–1251T for
determining the application of this
section to grandfathered health plans
(providing that these rules regarding
PO 00000
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Fmt 4700
Sfmt 4700
41757
coverage of preventive health services
do not apply to grandfathered health
plans).
(e) Expiration date. This section
expires on July 12, 2013 or on such
earlier date as may be provided in final
regulations or other action published in
the Federal Register.
DEPARTMENT OF LABOR
Employee Benefits Security
Administration
29 CFR Chapter XXV
29 CFR Part 2590 is amended as
follows:
■
PART 2590—RULES AND
REGULATIONS FOR GROUP HEALTH
PLANS
1. The authority citation for Part 2590
continues to read as follows:
■
Authority: 29 U.S.C. 1027, 1059, 1135,
1161–1168, 1169, 1181–1183, 1181 note,
1185, 1185a, 1185b, 1191, 1191a, 1191b, and
1191c; sec. 101(g), Pub. L. 104–191, 110 Stat.
1936; sec. 401(b), Pub. L. 105–200, 112 Stat.
645 (42 U.S.C. 651 note); sec. 512(d), Pub. L.
110–343, 122 Stat. 3881; sec. 1001, 1201, and
1562(e), Pub. L. 111–148, 124 Stat. 119, as
amended by Pub. L. 111–152, 124 Stat. 1029;
Secretary of Labor’s Order 6–2009, 74 FR
21524 (May 7, 2009).
Subpart C—Other Requirements
2. Section 2590.715–2713 is added to
subpart C to read as follows:
■
§ 2590.715–2713
health services.
Coverage of preventive
(a) Services—(1) In general. Beginning
at the time described in paragraph (b) of
this section, a group health plan, or a
health insurance issuer offering group
health insurance coverage, must provide
coverage for all of the following items
and services, and may not impose any
cost-sharing requirements (such as a
copayment, coinsurance, or deductible)
with respect to those items or services:
(i) Evidence-based items or services
that have in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force with respect to the individual
involved (except as otherwise provided
in paragraph (c) of this section);
(ii) Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention with
respect to the individual involved (for
this purpose, a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention is
considered in effect after it has been
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Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
mstockstill on DSKH9S0YB1PROD with RULES
adopted by the Director of the Centers
for Disease Control and Prevention, and
a recommendation is considered to be
for routine use if it is listed on the
Immunization Schedules of the Centers
for Disease Control and Prevention);
(iii) With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in comprehensive guidelines
supported by the Health Resources and
Services Administration; and
(iv) With respect to women, to the
extent not described in paragraph
(a)(1)(i) of this section, evidenceinformed preventive care and screenings
provided for in comprehensive
guidelines supported by the Health
Resources and Services Administration.
(2) Office visits—(i) If an item or
service described in paragraph (a)(1) of
this section is billed separately (or is
tracked as individual encounter data
separately) from an office visit, then a
plan or issuer may impose cost-sharing
requirements with respect to the office
visit.
(ii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is the delivery
of such an item or service, then a plan
or issuer may not impose cost-sharing
requirements with respect to the office
visit.
(iii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is not the
delivery of such an item or service, then
a plan or issuer may impose costsharing requirements with respect to the
office visit.
(iv) The rules of this paragraph (a)(2)
are illustrated by the following
examples:
Example 1. (i) Facts. An individual
covered by a group health plan visits an innetwork health care provider. While visiting
the provider, the individual is screened for
cholesterol abnormalities, which has in effect
a rating of A or B in the current
recommendations of the United States
Preventive Services Task Force with respect
to the individual. The provider bills the plan
for an office visit and for the laboratory work
of the cholesterol screening test.
(ii) Conclusion. In this Example 1, the plan
may not impose any cost-sharing
requirements with respect to the separatelybilled laboratory work of the cholesterol
screening test. Because the office visit is
billed separately from the cholesterol
screening test, the plan may impose costsharing requirements for the office visit.
Example 2. (i) Facts. Same facts as
Example 1. As the result of the screening, the
VerDate Mar<15>2010
15:50 Jul 16, 2010
Jkt 220001
individual is diagnosed with hyperlipidemia
and is prescribed a course of treatment that
is not included in the recommendations
under paragraph (a)(1) of this section.
(ii) Conclusion. In this Example 2, because
the treatment is not included in the
recommendations under paragraph (a)(1) of
this section, the plan is not prohibited from
imposing cost-sharing requirements with
respect to the treatment.
Example 3. (i) Facts. An individual
covered by a group health plan visits an innetwork health care provider to discuss
recurring abdominal pain. During the visit,
the individual has a blood pressure
screening, which has in effect a rating of A
or B in the current recommendations of the
United States Preventive Services Task Force
with respect to the individual. The provider
bills the plan for an office visit.
(ii) Conclusion. In this Example 3, the
blood pressure screening is provided as part
of an office visit for which the primary
purpose was not to deliver items or services
described in paragraph (a)(1) of this section.
Therefore, the plan may impose a costsharing requirement for the office visit
charge.
Example 4. (i) Facts. A child covered by a
group health plan visits an in-network
pediatrician to receive an annual physical
exam described as part of the comprehensive
guidelines supported by the Health
Resources and Services Administration.
During the office visit, the child receives
additional items and services that are not
described in the comprehensive guidelines
supported by the Health Resources and
Services Administration, nor otherwise
described in paragraph (a)(1) of this section.
The provider bills the plan for an office visit.
(ii) Conclusion. In this Example 4, the
service was not billed as a separate charge
and was billed as part of an office visit.
Moreover, the primary purpose for the visit
was to deliver items and services described
as part of the comprehensive guidelines
supported by the Health Resources and
Services Administration. Therefore, the plan
may not impose a cost-sharing requirement
with respect to the office visit.
(3) Out-of-network providers. Nothing
in this section requires a plan or issuer
that has a network of providers to
provide benefits for items or services
described in paragraph (a)(1) of this
section that are delivered by an out-ofnetwork provider. Moreover, nothing in
this section precludes a plan or issuer
that has a network of providers from
imposing cost-sharing requirements for
items or services described in paragraph
(a)(1) of this section that are delivered
by an out-of-network provider.
(4) Reasonable medical management.
Nothing prevents a plan or issuer from
using reasonable medical management
techniques to determine the frequency,
method, treatment, or setting for an item
or service described in paragraph (a)(1)
of this section to the extent not specified
in the recommendation or guideline.
(5) Services not described. Nothing in
this section prohibits a plan or issuer
PO 00000
Frm 00068
Fmt 4700
Sfmt 4700
from providing coverage for items and
services in addition to those
recommended by the United States
Preventive Services Task Force or the
Advisory Committee on Immunization
Practices of the Centers for Disease
Control and Prevention, or provided for
by guidelines supported by the Health
Resources and Services Administration,
or from denying coverage for items and
services that are not recommended by
that task force or that advisory
committee, or under those guidelines. A
plan or issuer may impose cost-sharing
requirements for a treatment not
described in paragraph (a)(1) of this
section, even if the treatment results
from an item or service described in
paragraph (a)(1) of this section.
(b) Timing—(1) In general. A plan or
issuer must provide coverage pursuant
to paragraph (a)(1) of this section for
plan years that begin on or after
September 23, 2010, or, if later, for plan
years that begin on or after the date that
is one year after the date the
recommendation or guideline is issued.
(2) Changes in recommendations or
guidelines. A plan or issuer is not
required under this section to provide
coverage for any items and services
specified in any recommendation or
guideline described in paragraph (a)(1)
of this section after the recommendation
or guideline is no longer described in
paragraph (a)(1) of this section. Other
requirements of Federal or State law
may apply in connection with a plan or
issuer ceasing to provide coverage for
any such items or services, including
PHS Act section 2715(d)(4), which
requires a plan or issuer to give 60 days
advance notice to an enrollee before any
material modification will become
effective.
(c) Recommendations not current. For
purposes of paragraph (a)(1)(i) of this
section, and for purposes of any other
provision of law, recommendations of
the United States Preventive Services
Task Force regarding breast cancer
screening, mammography, and
prevention issued in or around
November 2009 are not considered to be
current.
(d) Applicability date. The provisions
of this section apply for plan years
beginning on or after September 23,
2010. See § 2590.715–1251 of this Part
for determining the application of this
section to grandfathered health plans
(providing that these rules regarding
coverage of preventive health services
do not apply to grandfathered health
plans).
E:\FR\FM\19JYR1.SGM
19JYR1
Federal Register / Vol. 75, No. 137 / Monday, July 19, 2010 / Rules and Regulations
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
45 CFR Subtitle A
For the reasons stated in the preamble,
the Department of Health and Human
Services amends 45 CFR part 147,
added May 13, 2010, at 75 FR 27138,
effective July 12, 2010, as follows:
■
PART 147—HEALTH INSURANCE
REFORM REQUIREMENTS FOR THE
GROUP AND INDIVIDUAL HEALTH
INSURANCE MARKETS
1. The authority citation for part 147
continues to read as follows:
■
Authority: Sections 2701 through 2763,
2791, and 2792 of the Public Health Service
Act (42 U.S.C. 300gg through 300gg–63,
300gg–91, and 300gg–92), as amended.
■
2. Add § 147.130 to read as follows:
mstockstill on DSKH9S0YB1PROD with RULES
§ 147.130
services.
Coverage of preventive health
(a) Services—(1) In general. Beginning
at the time described in paragraph (b) of
this section, a group health plan, or a
health insurance issuer offering group or
individual health insurance coverage,
must provide coverage for all of the
following items and services, and may
not impose any cost-sharing
requirements (such as a copayment,
coinsurance, or deductible) with respect
to those items or services:
(i) Evidence-based items or services
that have in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force with respect to the individual
involved (except as otherwise provided
in paragraph (c) of this section);
(ii) Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention with
respect to the individual involved (for
this purpose, a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention is
considered in effect after it has been
adopted by the Director of the Centers
for Disease Control and Prevention, and
a recommendation is considered to be
for routine use if it is listed on the
Immunization Schedules of the Centers
for Disease Control and Prevention);
(iii) With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in comprehensive guidelines
supported by the Health Resources and
Services Administration; and
(iv) With respect to women, to the
extent not described in paragraph
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15:50 Jul 16, 2010
Jkt 220001
(a)(1)(i) of this section, evidenceinformed preventive care and screenings
provided for in comprehensive
guidelines supported by the Health
Resources and Services Administration.
(2) Office visits—(i) If an item or
service described in paragraph (a)(1) of
this section is billed separately (or is
tracked as individual encounter data
separately) from an office visit, then a
plan or issuer may impose cost-sharing
requirements with respect to the office
visit.
(ii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is the delivery
of such an item or service, then a plan
or issuer may not impose cost-sharing
requirements with respect to the office
visit.
(iii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is not the
delivery of such an item or service, then
a plan or issuer may impose costsharing requirements with respect to the
office visit.
(iv) The rules of this paragraph (a)(2)
are illustrated by the following
examples:
Example 1. (i) Facts. An individual
covered by a group health plan visits an innetwork health care provider. While visiting
the provider, the individual is screened for
cholesterol abnormalities, which has in effect
a rating of A or B in the current
recommendations of the United States
Preventive Services Task Force with respect
to the individual. The provider bills the plan
for an office visit and for the laboratory work
of the cholesterol screening test.
(ii) Conclusion. In this Example 1, the plan
may not impose any cost-sharing
requirements with respect to the separatelybilled laboratory work of the cholesterol
screening test. Because the office visit is
billed separately from the cholesterol
screening test, the plan may impose costsharing requirements for the office visit.
Example 2. (i) Facts. Same facts as
Example 1. As the result of the screening, the
individual is diagnosed with hyperlipidemia
and is prescribed a course of treatment that
is not included in the recommendations
under paragraph (a)(1) of this section.
(ii) Conclusion. In this Example 2, because
the treatment is not included in the
recommendations under paragraph (a)(1) of
this section, the plan is not prohibited from
imposing cost-sharing requirements with
respect to the treatment.
Example 3. (i) Facts. An individual
covered by a group health plan visits an innetwork health care provider to discuss
recurring abdominal pain. During the visit,
the individual has a blood pressure
PO 00000
Frm 00069
Fmt 4700
Sfmt 4700
41759
screening, which has in effect a rating of A
or B in the current recommendations of the
United States Preventive Services Task Force
with respect to the individual. The provider
bills the plan for an office visit.
(ii) Conclusion. In this Example 3, the
blood pressure screening is provided as part
of an office visit for which the primary
purpose was not to deliver items or services
described in paragraph (a)(1) of this section.
Therefore, the plan may impose a costsharing requirement for the office visit
charge.
Example 4. (i) Facts. A child covered by
a group health plan visits an in-network
pediatrician to receive an annual physical
exam described as part of the comprehensive
guidelines supported by the Health
Resources and Services Administration.
During the office visit, the child receives
additional items and services that are not
described in the comprehensive guidelines
supported by the Health Resources and
Services Administration, nor otherwise
described in paragraph (a)(1) of this section.
The provider bills the plan for an office visit.
(ii) Conclusion. In this Example 4, the
service was not billed as a separate charge
and was billed as part of an office visit.
Moreover, the primary purpose for the visit
was to deliver items and services described
as part of the comprehensive guidelines
supported by the Health Resources and
Services Administration. Therefore, the plan
may not impose a cost-sharing requirement
for the office visit charge.
(3) Out-of-network providers. Nothing
in this section requires a plan or issuer
that has a network of providers to
provide benefits for items or services
described in paragraph (a)(1) of this
section that are delivered by an out-ofnetwork provider. Moreover, nothing in
this section precludes a plan or issuer
that has a network of providers from
imposing cost-sharing requirements for
items or services described in paragraph
(a)(1) of this section that are delivered
by an out-of-network provider.
(4) Reasonable medical management.
Nothing prevents a plan or issuer from
using reasonable medical management
techniques to determine the frequency,
method, treatment, or setting for an item
or service described in paragraph (a)(1)
of this section to the extent not specified
in the recommendation or guideline.
(5) Services not described. Nothing in
this section prohibits a plan or issuer
from providing coverage for items and
services in addition to those
recommended by the United States
Preventive Services Task Force or the
Advisory Committee on Immunization
Practices of the Centers for Disease
Control and Prevention, or provided for
by guidelines supported by the Health
Resources and Services Administration,
or from denying coverage for items and
services that are not recommended by
that task force or that advisory
committee, or under those guidelines. A
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plan or issuer may impose cost-sharing
requirements for a treatment not
described in paragraph (a)(1) of this
section, even if the treatment results
from an item or service described in
paragraph (a)(1) of this section.
(b) Timing—(1) In general. A plan or
issuer must provide coverage pursuant
to paragraph (a)(1) of this section for
plan years (in the individual market,
policy years) that begin on or after
September 23, 2010, or, if later, for plan
years (in the individual market, policy
years) that begin on or after the date that
is one year after the date the
recommendation or guideline is issued.
(2) Changes in recommendations or
guidelines. A plan or issuer is not
required under this section to provide
coverage for any items and services
specified in any recommendation or
guideline described in paragraph (a)(1)
of this section after the recommendation
or guideline is no longer described in
paragraph (a)(1) of this section. Other
requirements of Federal or State law
may apply in connection with a plan or
issuer ceasing to provide coverage for
any such items or services, including
PHS Act section 2715(d)(4), which
requires a plan or issuer to give 60 days
advance notice to an enrollee before any
material modification will become
effective.
(c) Recommendations not current. For
purposes of paragraph (a)(1)(i) of this
section, and for purposes of any other
provision of law, recommendations of
the United States Preventive Services
Task Force regarding breast cancer
screening, mammography, and
prevention issued in or around
November 2009 are not considered to be
current.
(d) Applicability date. The provisions
of this section apply for plan years (in
the individual market, for policy years)
beginning on or after September 23,
2010. See § 147.140 of this Part for
determining the application of this
section to grandfathered health plans
(providing that these rules regarding
coverage of preventive health services
do not apply to grandfathered health
plans).
[FR Doc. 2010–17242 Filed 7–14–10; 11:15 am]
mstockstill on DSKH9S0YB1PROD with RULES
BILLING CODE 4830–01–P; 4510–29–P; 4210–01–P
DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Part 165
[Docket No. USCG–2010–0646]
RIN 1625–AA00
Safety Zone; Transformers 3 Movie
Filming, Chicago River, Chicago, IL
Coast Guard, DHS.
Temporary final rule.
AGENCY:
ACTION:
SUMMARY: The Coast Guard is
establishing a temporary safety zone on
the Chicago River near Chicago, Illinois.
This zone is intended to restrict vessels
from a portion of the Chicago River due
to the filming of a major motion picture.
This temporary safety zone is necessary
to protect the surrounding public and
vessels from the hazards associated with
the different types of stunts that will be
performed during the filming of this
movie.
DATES: Effective Date: this rule is
effective in the CFR from July 19, 2010
until 9 p.m. on July 19, 2010. This rule
is effective with actual notice for
purposes of enforcement beginning 7
a.m. on July 16, 2010.
ADDRESSES: Documents indicated in this
preamble as being available in the
docket are part of docket USCG–2010–
0646 and are available online by going
to https://www.regulations.gov, inserting
USCG–2010–0646 in the ‘‘Keyword’’
box, and then clicking ‘‘search.’’ They
are also available for inspection or
copying at the Docket Management
Facility (M–30), U.S. Department of
Transportation, West Building Ground
floor, Room W12–140, 1200 New Jersey
Avenue, SE., Washington DC 20590,
between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
FOR FURTHER INFORMATION CONTACT: If
you have questions on this temporary
rule, contact or email BM1 Adam Kraft,
U.S. Coast Guard Sector Lake Michigan,
at 414–747–7154 or
Adam.D.Kraft@uscg.mil. If you have
questions on viewing the docket, call
Renee V. Wright, Program Manager,
Docket Operations, telephone 202–366–
9826.
SUPPLEMENTARY INFORMATION:
Regulatory Information
The Coast Guard is issuing this
temporary final rule without prior
notice and opportunity to comment
pursuant to authority under section 4(a)
of the Administrative Procedure Act
(APA) (5 U.S.C. 553(b)). This provision
VerDate Mar<15>2010
18:18 Jul 16, 2010
Jkt 220001
PO 00000
Frm 00070
Fmt 4700
Sfmt 4700
authorizes an agency to issue a rule
without prior notice and opportunity to
comment when an agency for good
cause finds that those procedures are
‘‘impracticable, unnecessary, or contrary
to the public interest.’’ Under U.S.C. 553
(b)(B), the Coast Guard finds that good
cause exists for not publishing a notice
of proposed rulemaking (NPRM) with
respect to the fact that the application
for this event was not submitted to our
office in time to allow for publishing an
NPRM. Based on the hazards associated
with the filming of this major motion
picture, delaying the publication of this
rule to provide for a comment would be
contrary to public interest as immediate
action is necessary to protect the public.
Under 5 U.S.C. 553(d)(3), the Coast
Guard finds that good cause exists for
making this rule effective less than 30
days after publication in the Federal
Register because delaying the effective
date would be contrary to the public
interest since immediate action is
needed to protect the public and the
event would be over by the time the 30
day period is completed.
Basis and Purpose
This temporary safety zone is
necessary to protect vessels from the
hazards associated with the filming of
the major motion picture, Transformers
3. The combination of congested
waterways and the filming of dangerous
stunts taking place on or near the water
pose serious risks of injury to persons
and property. As such, the Captain of
the Port, Sector Lake Michigan, has
determined that the filming of this
motion picture does pose significant
risks to public safety and property and
that a temporary safety zone is
necessary.
Discussion of Rule
The safety zone will encompass all
U.S. navigable waters of the Chicago
River between the Michigan Avenue
Bridge, 41°53′20″ N. 087°37′27″ W. and
the North Columbus Drive Bascule
Bridge, 41°53′19″ N. 087°37′13″ W.
[DATUM: NAD 83].
All persons and vessels shall comply
with the instructions of the Coast Guard
Captain of the Port, Sector Lake
Michigan, or his or her on-scene
representative. Entry into, transiting, or
anchoring within the safety zone is
prohibited unless authorized by the
Captain of the Port, Sector Lake
Michigan, or his or her on-scene
representative. The Captain of the Port,
Sector Lake Michigan, or his or her onscene representative may be contacted
via VHF Channel 16.
E:\FR\FM\19JYR1.SGM
19JYR1
]]>Agencies
[Federal Register Volume 75, Number 137 (Monday, July 19, 2010)]
[Rules and Regulations]
[Pages 41726-41760]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-17242]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
[TD 9493]
RIN 1545-BJ60
DEPARTMENT OF LABOR
Employee Benefits Security Administration
29 CFR Part 2590
RIN 1210-AB44
DEPARTMENT OF HEALTH AND HUMAN SERVICES
[OCIIO-9992-IFC]
45 CFR Part 147
RIN 0938-AQ07
Interim Final Rules for Group Health Plans and Health Insurance
Issuers Relating to Coverage of Preventive Services Under the Patient
Protection and Affordable Care Act
AGENCIES: Internal Revenue Service, Department of the Treasury;
Employee Benefits Security Administration, Department of Labor; Office
of Consumer Information and Insurance Oversight, Department of Health
and Human Services.
ACTION: Interim final rules with request for comments.
-----------------------------------------------------------------------
SUMMARY: This document contains interim final regulations implementing
the rules for group health plans and health insurance coverage in the
group and individual markets under provisions of the Patient Protection
and Affordable Care Act regarding preventive health services.
DATES: Effective date. These interim final regulations are effective on
September 17, 2010.
Comment date. Comments are due on or before September 17, 2010.
Applicability dates. These interim final regulations generally
apply to group health plans and group health insurance issuers for plan
years beginning on or after September 23, 2010. These interim final
regulations generally apply to individual health insurance issuers for
policy years beginning on or after September 23, 2010.
ADDRESSES: Written comments may be submitted to any of the addresses
specified below. Any comment that is submitted to any Department will
be shared with the other Departments. Please do not submit duplicates.
All comments will be made available to the public. WARNING: Do not
include any personally identifiable information (such as name, address,
or other contact information) or confidential business information that
you do not want publicly disclosed. All comments are posted on the
Internet exactly as received, and can be retrieved by most Internet
search engines. No deletions, modifications, or redactions will be made
to the comments received, as they are public records. Comments may be
submitted anonymously.
Department of Labor. Comments to the Department of Labor,
identified by RIN 1210-AB44, by one of the following methods:
Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
E-mail: E-OHPSCA2713.EBSA@dol.gov.
Mail or Hand Delivery: Office of Health Plan Standards and
Compliance Assistance, Employee Benefits Security Administration, Room
N-5653, U.S. Department of Labor, 200 Constitution Avenue, NW.,
Washington, DC 20210, Attention: RIN 1210-AB44.
Comments received by the Department of Labor will be posted without
change to https://www.regulations.gov and https://www.dol.gov/ebsa, and
available for public inspection at the Public Disclosure Room, N-1513,
Employee Benefits Security Administration, 200 Constitution Avenue,
NW., Washington, DC 20210.
Department of Health and Human Services. In commenting, please
refer to file code OCIIO-9992-IFC. Because of staff and resource
limitations, we cannot accept comments by facsimile (FAX) transmission.
You may submit comments in one of four ways (please choose only one
of the ways listed):
1. Electronically. You may submit electronic comments on this
regulation to https://www.regulations.gov. Follow the instructions under
the ``More Search Options'' tab.
2. By regular mail. You may mail written comments to the following
address ONLY: Office of Consumer Information and Insurance Oversight,
Department of Health and Human Services, Attention: OCIIO-9992-IFC,
P.O. Box 8016, Baltimore, MD 21244-1850.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the
[[Page 41727]]
following address ONLY: Office of Consumer Information and Insurance
Oversight, Department of Health and Human Services, Attention: OCIIO-
9992-IFC, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD
21244-1850.
4. By hand or courier. If you prefer, you may deliver (by hand or
courier) your written comments before the close of the comment period
to either of the following addresses:
a. For delivery in Washington, DC--Office of Consumer Information
and Insurance Oversight, Department of Health and Human Services, Room
445-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW.,
Washington, DC 20201.
(Because access to the interior of the Hubert H. Humphrey Building
is not readily available to persons without Federal government
identification, commenters are encouraged to leave their comments in
the OCIIO drop slots located in the main lobby of the building. A
stamp-in clock is available for persons wishing to retain a proof of
filing by stamping in and retaining an extra copy of the comments
being filed.)
b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid
Services, Department of Health and Human Services, 7500 Security
Boulevard, Baltimore, MD 21244-1850.
If you intend to deliver your comments to the Baltimore address,
please call (410) 786-7195 in advance to schedule your arrival with one
of our staff members.
Comments mailed to the addresses indicated as appropriate for hand
or courier delivery may be delayed and received after the comment
period.
Submission of comments on paperwork requirements. You may submit
comments on this document's paperwork requirements by following the
instructions at the end of the ``Collection of Information
Requirements'' section in this document.
Inspection of Public Comments. All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period on the following Web
site as soon as possible after they have been received: https://www.regulations.gov. Follow the search instructions on that Web site to
view public comments.
Comments received timely will also be available for public
inspection as they are received, generally beginning approximately
three weeks after publication of a document, at the headquarters of the
Centers for Medicare & Medicaid Services, 7500 Security Boulevard,
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30
a.m. to 4 p.m. EST. To schedule an appointment to view public comments,
phone 1-800-743-3951.
Internal Revenue Service. Comments to the IRS, identified by REG-
120391-10, by one of the following methods:
Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: CC:PA:LPD:PR (REG-120391-10), room 5205, Internal
Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC
20044.
Hand or courier delivery: Monday through Friday between
the hours of 8 a.m. and 4 p.m. to: CC:PA:LPD:PR (REG-120391-10),
Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue,
NW., Washington DC 20224.
All submissions to the IRS will be open to public inspection and
copying in room 1621, 1111 Constitution Avenue, NW., Washington, DC
from 9 a.m. to 4 p.m.
FOR FURTHER INFORMATION CONTACT: Amy Turner or Beth Baum, Employee
Benefits Security Administration, Department of Labor, at (202) 693-
8335; Karen Levin, Internal Revenue Service, Department of the
Treasury, at (202) 622-6080; Jim Mayhew, Office of Consumer Information
and Insurance Oversight, Department of Health and Human Services, at
(410) 786-1565.
Customer Service Information: Individuals interested in obtaining
information from the Department of Labor concerning employment-based
health coverage laws may call the EBSA Toll-Free Hotline at 1-866-444-
EBSA (3272) or visit the Department of Labor's Web site (https://www.dol.gov/ebsa). In addition, information from HHS on private health
insurance for consumers can be found on the Centers for Medicare &
Medicaid Services (CMS) Web site (https://www.cms.hhs.gov/HealthInsReformforConsume/01_Overview.as) and information on health
reform can be found at https://www.healthreform.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The Patient Protection and Affordable Care Act (the Affordable Care
Act), Public Law 111-148, was enacted on March 23, 2010; the Health
Care and Education Reconciliation Act (the Reconciliation Act), Public
Law 111-152, was enacted on March 30, 2010. The Affordable Care Act and
the Reconciliation Act reorganize, amend, and add to the provisions of
part A of title XXVII of the Public Health Service Act (PHS Act)
relating to group health plans and health insurance issuers in the
group and individual markets. The term ``group health plan'' includes
both insured and self-insured group health plans.\1\ The Affordable
Care Act adds section 715(a)(1) to the Employee Retirement Income
Security Act (ERISA) and section 9815(a)(1) to the Internal Revenue
Code (the Code) to incorporate the provisions of part A of title XXVII
of the PHS Act into ERISA and the Code, and make them applicable to
group health plans, and health insurance issuers providing health
insurance coverage in connection with group health plans. The PHS Act
sections incorporated by this reference are sections 2701 through 2728.
PHS Act sections 2701 through 2719A are substantially new, though they
incorporate some provisions of prior law. PHS Act sections 2722 through
2728 are sections of prior law renumbered, with some, mostly minor,
changes.
---------------------------------------------------------------------------
\1\ The term ``group health plan'' is used in title XXVII of the
PHS Act, part 7 of ERISA, and chapter 100 of the Code, and is
distinct from the term ``health plan,'' as used in other provisions
of title I of the Affordable Care Act. The term ``health plan'' does
not include self-insured group health plans.
---------------------------------------------------------------------------
Subtitles A and C of title I of the Affordable Care Act amend the
requirements of title XXVII of the PHS Act (changes to which are
incorporated into ERISA section 715). The preemption provisions of
ERISA section 731 and PHS Act section 2724 \2\ (implemented in 29 CFR
2590.731(a) and 45 CFR 146.143(a)) apply so that the requirements of
part 7 of ERISA and title XXVII of the PHS Act, as amended by the
Affordable Care Act, are not to be ``construed to supersede any
provision of State law which establishes, implements, or continues in
effect any standard or requirement solely relating to health insurance
issuers in connection with group or individual health insurance
coverage except to the extent that such standard or requirement
prevents the application of a requirement'' of the Affordable Care Act.
Accordingly, State laws that impose on health insurance issuers
requirements that are stricter than those imposed by the Affordable
Care Act will not be superseded by the Affordable Care Act.
---------------------------------------------------------------------------
\2\ Code section 9815 incorporates the preemption provisions of
PHS Act section 2724. Prior to the Affordable Care Act, there were
no express preemption provisions in chapter 100 of the Code.
---------------------------------------------------------------------------
[[Page 41728]]
The Departments of Health and Human Services, Labor, and the
Treasury (the Departments) are issuing regulations in several phases
implementing the revised PHS Act sections 2701 through 2719A and
related provisions of the Affordable Care Act. The first phase in this
series was the publication of a Request for Information relating to the
medical loss ratio provisions of PHS Act section 2718, published in the
Federal Register on April 14, 2010 (75 FR 19297). The second phase was
interim final regulations implementing PHS Act section 2714 (requiring
dependent coverage of children to age 26), published in the Federal
Register on May 13, 2010 (75 FR 27122). The third phase was interim
final regulations implementing section 1251 of the Affordable Care Act
(relating to status as a grandfathered health plan), published in the
Federal Register on June 17, 2010 (75 FR 34538). The fourth phase was
interim final regulations implementing PHS Act sections 2704
(prohibiting preexisting condition exclusions), 2711 (regarding
lifetime and annual dollar limits on benefits), 2712 (regarding
restrictions on rescissions), and 2719A (regarding patient
protections), published in the Federal Register on June 28, 2010 (75 FR
37188). These interim final regulations are being published to
implement PHS Act section 2713 (relating to coverage for preventive
services). PHS Act section 2713 is generally effective for plan years
(in the individual market, policy years) beginning on or after
September 23, 2010, which is six months after the March 23, 2010 date
of enactment of the Affordable Care Act. The implementation of other
provisions of PHS Act sections 2701 through 2719A will be addressed in
future regulations.
II. Overview of the Regulations: PHS Act Section 2713, Coverage of
Preventive Health Services (26 CFR 54.9815-2713T, 29 CFR 2590.715-2713,
45 CFR 147.130)
Section 2713 of the PHS Act, as added by the Affordable Care Act,
and these interim final regulations require that a group health plan
and a health insurance issuer offering group or individual health
insurance coverage provide benefits for and prohibit the imposition of
cost-sharing requirements with respect to:
Evidence-based items or services that have in effect a
rating of A or B in the current recommendations of the United States
Preventive Services Task Force (Task Force) with respect to the
individual involved.\3\
---------------------------------------------------------------------------
\3\ Under PHS Act section 2713(a)(5), the Task Force
recommendations regarding breast cancer screening, mammography, and
prevention issued in or around November of 2009 are not to be
considered current recommendations on this subject for purposes of
any law. Thus, the recommendations regarding breast cancer
screening, mammography, and prevention issued by the Task Force
prior to those issued in or around November of 2009 (i.e., those
issued in 2002) will be considered current until new recommendations
in this area are issued by the Task Force or appear in comprehensive
guidelines supported by the Health Resources and Services
Administration concerning preventive care and screenings for women.
---------------------------------------------------------------------------
Immunizations for routine use in children, adolescents,
and adults that have in effect a recommendation from the Advisory
Committee on Immunization Practices of the Centers for Disease Control
and Prevention (Advisory Committee) with respect to the individual
involved. A recommendation of the Advisory Committee is considered to
be ``in effect'' after it has been adopted by the Director of the
Centers for Disease Control and Prevention. A recommendation is
considered to be for routine use if it appears on the Immunization
Schedules of the Centers for Disease Control and Prevention.
With respect to infants, children, and adolescents,
evidence-informed preventive care and screenings provided for in the
comprehensive guidelines supported by the Health Resources and Services
Administration (HRSA).
With respect to women, evidence-informed preventive care
and screening provided for in comprehensive guidelines supported by
HRSA (not otherwise addressed by the recommendations of the Task
Force). The Department of HHS is developing these guidelines and
expects to issue them no later than August 1, 2011.
The complete list of recommendations and guidelines that are
required to be covered under these interim final regulations can be
found at https://www.HealthCare.gov/center/regulations/prevention.html.
Together, the items and services described in these recommendations and
guidelines are referred to in this preamble as ``recommended preventive
services.''
These interim final regulations clarify the cost-sharing
requirements when a recommended preventive service is provided during
an office visit. First, if a recommended preventive service is billed
separately (or is tracked as individual encounter data separately) from
an office visit, then a plan or issuer may impose cost-sharing
requirements with respect to the office visit. Second, if a recommended
preventive service is not billed separately (or is not tracked as
individual encounter data separately) from an office visit and the
primary purpose of the office visit is the delivery of such an item or
service, then a plan or issuer may not impose cost-sharing requirements
with respect to the office visit. Finally, if a recommended preventive
service is not billed separately (or is not tracked as individual
encounter data separately) from an office visit and the primary purpose
of the office visit is not the delivery of such an item or service,
then a plan or issuer may impose cost-sharing requirements with respect
to the office visit. The reference to tracking individual encounter
data was included to provide guidance with respect to plans and issuers
that use capitation or similar payment arrangements that do not bill
individually for items and services.
Examples in these interim final regulations illustrate these
provisions. In one example, an individual receives a cholesterol
screening test, a recommended preventive service, during a routine
office visit. The plan or issuer may impose cost-sharing requirements
for the office visit because the recommended preventive service is
billed as a separate charge. A second example illustrates that
treatment resulting from a preventive screening can be subject to cost-
sharing requirements if the treatment is not itself a recommended
preventive service. In another example, an individual receives a
recommended preventive service that is not billed as a separate charge.
In this example, the primary purpose for the office visit is recurring
abdominal pain and not the delivery of a recommended preventive
service; therefore the plan or issuer may impose cost-sharing
requirements for the office visit. In the final example, an individual
receives a recommended preventive service that is not billed as a
separate charge, and the delivery of that service is the primary
purpose of the office visit. Therefore, the plan or issuer may not
impose cost-sharing requirements for the office visit.
With respect to a plan or health insurance coverage that has a
network of providers, these interim final regulations make clear that a
plan or issuer is not required to provide coverage for recommended
preventive services delivered by an out-of-network provider. Such a
plan or issuer may also impose cost-sharing requirements for
recommended preventive services delivered by an out-of-network
provider.
These interim final regulations provide that if a recommendation or
[[Page 41729]]
guideline for a recommended preventive service does not specify the
frequency, method, treatment, or setting for the provision of that
service, the plan or issuer can use reasonable medical management
techniques to determine any coverage limitations. The use of reasonable
medical management techniques allows plans and issuers to adapt these
recommendations and guidelines to coverage of specific items and
services where cost sharing must be waived. Thus, under these interim
final regulations, a plan or issuer may rely on established techniques
and the relevant evidence base to determine the frequency, method,
treatment, or setting for which a recommended preventive service will
be available without cost-sharing requirements to the extent not
specified in a recommendation or guideline.
The statute and these interim final regulations clarify that a plan
or issuer continues to have the option to cover preventive services in
addition to those required to be covered by PHS Act section 2713. For
such additional preventive services, a plan or issuer may impose cost-
sharing requirements at its discretion. Moreover, a plan or issuer may
impose cost-sharing requirements for a treatment that is not a
recommended preventive service, even if the treatment results from a
recommended preventive service.
The statute requires the Departments to establish an interval of
not less than one year between when recommendations or guidelines under
PHS Act section 2713(a) \4\ are issued, and the plan year (in the
individual market, policy year) for which coverage of the services
addressed in such recommendations or guidelines must be in effect.
These interim final regulations provide that such coverage must be
provided for plan years (in the individual market, policy years)
beginning on or after the later of September 23, 2010, or one year
after the date the recommendation or guideline is issued. Thus,
recommendations and guidelines issued prior to September 23, 2009 must
be provided for plan years (in the individual market, policy years)
beginning on or after September 23, 2010. For the purpose of these
interim final regulations, a recommendation or guideline of the Task
Force is considered to be issued on the last day of the month on which
the Task Force publishes or otherwise releases the recommendation; a
recommendation or guideline of the Advisory Committee is considered to
be issued on the date on which it is adopted by the Director of the
Centers for Disease Control and Prevention; and a recommendation or
guideline in the comprehensive guidelines supported by HRSA is
considered to be issued on the date on which it is accepted by the
Administrator of HRSA or, if applicable, adopted by the Secretary of
HHS. For recommendations and guidelines adopted after September 23,
2009, information at https://www.HealthCare.gov/center/regulations/prevention.html will be updated on an ongoing basis and will include
the date on which the recommendation or guideline was accepted or
adopted.
---------------------------------------------------------------------------
\4\ Section 2713(b)(1) refers to an interval between ``the date
on which a recommendation described in subsection (a)(1) or (a)(2)
or a guideline under subsection (a)(3) is issued and the plan year
with respect to which the requirement described in subsection (a) is
effective with respect to the service described in such
recommendation or guideline.'' While the first part of this
statement does not mention guidelines under subsection (a)(4), it
would make no sense to treat the services covered under (a)(4) any
differently than those in (a)(1), (a)(2), and (a)(3). First, the
same sentence refers to ``the requirement described in subsection
(a),'' which would include a requirement under (a)(4). Secondly, the
guidelines under (a)(4) are from the same source as those under
(a)(3), except with respect to women rather than infants, children
and adolescents; and other preventive services involving women are
addressed in (a)(1), so there is no plausible policy rationale for
treating them differently. Third, without this clarification, it
would be unclear when such services would have to be covered. These
interim final regulations accordingly apply the intervals
established therein to services under section 2713(a)(4).
---------------------------------------------------------------------------
Finally, these interim final regulations make clear that a plan or
issuer is not required to provide coverage or waive cost-sharing
requirements for any item or service that has ceased to be a
recommended preventive service.\5\ Other requirements of Federal or
State law may apply in connection with ceasing to provide coverage or
changing cost-sharing requirements for any such item or service. For
example, PHS Act section 2715(d)(4) requires a plan or issuer to give
60 days advance notice to an enrollee before any material modification
will become effective.
---------------------------------------------------------------------------
\5\ For example, if a recommendation of the United States
Preventive Services Task Force is downgraded from a rating of A or B
to a rating of C or D, or if a recommendation or guideline no longer
includes a particular item or service.
---------------------------------------------------------------------------
Recommendations or guidelines in effect as of July 13, 2010 are
described in section V later in this preamble. Any change to a
recommendation or guideline that has--at any point since September 23,
2009--been included in the recommended preventive services will be
noted at https://www.HealthCare.gov/center/regulations/prevention.html.
As described above, new recommendations and guidelines will also be
noted at this site and plans and issuers need not make changes to
coverage and cost-sharing requirements based on a new recommendation or
guideline until the first plan year (in the individual market, policy
year) beginning on or after the date that is one year after the new
recommendation or guideline went into effect. Therefore, by visiting
this site once per year, plans or issuers will have straightforward
access to all the information necessary to determine any additional
items or services that must be covered without cost-sharing
requirements, or to determine any items or services that are no longer
required to be covered.
The Affordable Care Act gives authority to the Departments to
develop guidelines for group health plans and health insurance issuers
offering group or individual health insurance coverage to utilize
value-based insurance designs as part of their offering of preventive
health services. Value-based insurance designs include the provision of
information and incentives for consumers that promote access to and use
of higher value providers, treatments, and services. The Departments
recognize the important role that value-based insurance design can play
in promoting the use of appropriate preventive services. These interim
final regulations, for example, permit plans and issuers to implement
designs that seek to foster better quality and efficiency by allowing
cost-sharing for recommended preventive services delivered on an out-
of-network basis while eliminating cost-sharing for recommended
preventive health services delivered on an in-network basis. The
Departments are developing additional guidelines regarding the
utilization of value-based insurance designs by group health plans and
health insurance issuers with respect to preventive benefits. The
Departments are seeking comments related to the development of such
guidelines for value-based insurance designs that promote consumer
choice of providers or services that offer the best value and quality,
while ensuring access to critical, evidence-based preventive services.
The requirements to cover recommended preventive services without
any cost-sharing requirements do not apply to grandfathered health
plans. See 26 CFR 54.9815-1251T, 29 CFR 2590.715-1251, and 45 CFR
147.140 (75 FR 34538, June 17, 2010).
III. Interim Final Regulations and Request for Comments
Section 9833 of the Code, section 734 of ERISA, and section 2792 of
the PHS
[[Page 41730]]
Act authorize the Secretaries of the Treasury, Labor, and HHS
(collectively, the Secretaries) to promulgate any interim final rules
that they determine are appropriate to carry out the provisions of
chapter 100 of the Code, part 7 of subtitle B of title I of ERISA, and
part A of title XXVII of the PHS Act, which include PHS Act sections
2701 through 2728 and the incorporation of those sections into ERISA
section 715 and Code section 9815.
In addition, under Section 553(b) of the Administrative Procedure
Act (APA) (5 U.S.C. 551 et seq.) a general notice of proposed
rulemaking is not required when an agency, for good cause, finds that
notice and public comment thereon are impracticable, unnecessary, or
contrary to the public interest. The provisions of the APA that
ordinarily require a notice of proposed rulemaking do not apply here
because of the specific authority granted by section 9833 of the Code,
section 734 of ERISA, and section 2792 of the PHS Act. However, even if
the APA were applicable, the Secretaries have determined that it would
be impracticable and contrary to the public interest to delay putting
the provisions in these interim final regulations in place until a full
public notice and comment process was completed. As noted above, the
preventive health service provisions of the Affordable Care Act are
applicable for plan years (in the individual market, policy years)
beginning on or after September 23, 2010, six months after date of
enactment. Had the Departments published a notice of proposed
rulemaking, provided for a 60-day comment period, and only then
prepared final regulations, which would be subject to a 60-day delay in
effective date, it is unlikely that it would have been possible to have
final regulations in effect before late September, when these
requirements could be in effect for some plans or policies. Moreover,
the requirements in these interim final regulations require significant
lead time in order to implement. These interim final regulations
require plans and issuers to provide coverage for preventive services
listed in certain recommendations and guidelines without imposing any
cost-sharing requirements. Preparations presumably would have to be
made to identify these preventive services. With respect to the changes
that would be required to be made under these interim final
regulations, group health plans and health insurance issuers subject to
these provisions have to be able to take these changes into account in
establishing their premiums, and in making other changes to the designs
of plan or policy benefits, and these premiums and plan or policy
changes would have to receive necessary approvals in advance of the
plan or policy year in question.
Accordingly, in order to allow plans and health insurance coverage
to be designed and implemented on a timely basis, regulations must be
published and available to the public well in advance of the effective
date of the requirements of the Affordable Care Act. It is not possible
to have a full notice and comment process and to publish final
regulations in the brief time between enactment of the Affordable Care
Act and the date regulations are needed.
The Secretaries further find that issuance of proposed regulations
would not be sufficient because the provisions of the Affordable Care
Act protect significant rights of plan participants and beneficiaries
and individuals covered by individual health insurance policies and it
is essential that participants, beneficiaries, insureds, plan sponsors,
and issuers have certainty about their rights and responsibilities.
Proposed regulations are not binding and cannot provide the necessary
certainty. By contrast, the interim final regulations provide the
public with an opportunity for comment, but without delaying the
effective date of the regulations.
For the foregoing reasons, the Departments have determined that it
is impracticable and contrary to the public interest to engage in full
notice and comment rulemaking before putting these interim final
regulations into effect, and that it is in the public interest to
promulgate interim final regulations.
IV. Economic Impact
Under Executive Order 12866 (58 FR 51735), a ``significant''
regulatory action is subject to review by the Office of Management and
Budget (OMB). Section 3(f) of the Executive Order defines a
``significant regulatory action'' as an action that is likely to result
in a rule (1) having an annual effect on the economy of $100 million or
more in any one year, or adversely and materially affecting a sector of
the economy, productivity, competition, jobs, the environment, public
health or safety, or State, local or tribal governments or communities
(also referred to as ``economically significant''); (2) creating a
serious inconsistency or otherwise interfering with an action taken or
planned by another agency; (3) materially altering the budgetary
impacts of entitlement grants, user fees, or loan programs or the
rights and obligations of recipients thereof; or (4) raising novel
legal or policy issues arising out of legal mandates, the President's
priorities, or the principles set forth in the Executive Order. OMB has
determined that this regulation is economically significant within the
meaning of section 3(f)(1) of the Executive Order, because it is likely
to have an annual effect on the economy of $100 million in any one
year. Accordingly, OMB has reviewed these rules pursuant to the
Executive Order. The Departments provide an assessment of the potential
costs, benefits, and transfers associated with these interim final
regulations, summarized in the following table.
TABLE 1--Accounting Table (2011-2013)
----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
Benefits:
Qualitative: By expanding coverage and eliminating cost sharing for the recommended preventive services, the
Departments expect access and utilization of these services to increase. To the extent that individuals
increase their use of these services the Departments anticipate several benefits: (1) prevention and reduction
in transmission of illnesses as a result of immunization and screening of transmissible diseases; (2) delayed
onset, earlier treatment, and reduction in morbidity and mortality as a result of early detection, screening,
and counseling; (3) increased productivity and fewer sick days; and (4) savings from lower health care costs.
Another benefit of these interim final regulations will be to distribute the cost of preventive services more
equitably across the broad insured population.
Costs:
Qualitative: New costs to the health care system result when beneficiaries increase their use of preventive
services in response to the changes in coverage and cost-sharing requirements of preventive services. The
magnitude of this effect on utilization depends on the price elasticity of demand and the percentage change in
prices facing those with reduced cost sharing or newly gaining coverage.
Transfers:
[[Page 41731]]
Qualitative: Transfers will occur to the extent that costs that were previously paid out-of-pocket for certain
preventive services will now be covered by group health plans and issuers under these interim final
regulations. Risk pooling in the group market will result in sharing expected cost increases across an entire
plan or employee group as higher average premiums for all enrollees. However, not all of those covered will
utilize preventive services to an equivalent extent. As a result, these interim final regulations create a
small transfer from those paying premiums in the group market utilizing less than the average volume of
preventive services in their risk pool to those whose utilization is greater than average. To the extent there
is risk pooling in the individual market, a similar transfer will occur.
----------------------------------------------------------------------------------------------------------------
A. The Need for Federal Regulatory Action
As discussed later in this preamble, there is current
underutilization of preventive services, which stems from three main
factors. First, due to turnover in the health insurance market, health
insurance issuers do not currently have incentives to cover preventive
services, whose benefits may only be realized in the future when an
individual may no longer be enrolled. Second, many preventive services
generate benefits that do not accrue immediately to the individual that
receives the services, making the individual less likely to take-up,
especially in the face of direct, immediate costs. Third, some of the
benefits of preventive services accrue to society as a whole, and thus
do not get factored into an individual's decision-making over whether
to obtain such services.
These interim final regulations address these market failures
through two avenues. First, they require coverage of recommended
preventive services by non-grandfathered group health plans and health
insurance issuers in the group and individual markets, thereby
overcoming plans' lack of incentive to invest in these services.
Second, they eliminate cost-sharing requirements, thereby removing a
barrier that could otherwise lead an individual to not obtain such
services, given the long-term and partially external nature of
benefits.
These interim final regulations are necessary in order to provide
rules that plan sponsors and issuers can use to determine how to
provide coverage for certain preventive health care services without
the imposition of cost sharing in connection with these services.
B. PHS Act Section 2713, Coverage of Preventive Health Services (26 CFR
54.9815-2713T, 29 CFR 2590.715-2713, 45 CFR 147.130)
1. Summary
As discussed earlier in this preamble, PHS Act section 2713, as
added by the Affordable Care Act, and these interim final regulations
require a group health plan and a health insurance issuer offering
group or individual health insurance coverage to provide benefits for
and prohibit the imposition of cost-sharing requirements with respect
to the following preventive health services:
Evidence-based items or services that have in effect a
rating of A or B in the current recommendations of the United States
Preventive Services Task Force (Task Force). While these guidelines
will change over time, for the purposes of this impact analysis, the
Departments utilized currently available guidelines, which include
blood pressure and cholesterol screening, diabetes screening for
hypertensive patients, various cancer and sexually transmitted
infection screenings, and counseling related to aspirin use, tobacco
cessation, obesity, and other topics.
Immunizations for routine use in children, adolescents,
and adults that have in effect a recommendation from the Advisory
Committee on Immunization Practices of the Centers for Disease Control
and Prevention (Advisory Committee) with respect to the individual
involved.
With respect to infants, children, and adolescents,
evidence-informed preventive care and screenings provided for in the
comprehensive guidelines supported by the Health Resources and Services
Administration (HRSA).
With respect to women, evidence-informed preventive care
and screening provided for in comprehensive guidelines supported by
HRSA (not otherwise addressed by the recommendations of the Task
Force). The Department of HHS is developing these guidelines and
expects to issue them no later than August 1, 2011.
2. Preventive Services
For the purposes of this analysis, the Departments used the
relevant recommendations of the Task Force and Advisory Committee and
current HRSA guidelines as described in section V later in this
preamble. In addition to covering immunizations, these lists include
such services as blood pressure and cholesterol screening, diabetes
screening for hypertensive patients, various cancer and sexually
transmitted infection screenings, genetic testing for the BRCA gene,
adolescent depression screening, lead testing, autism testing, and oral
health screening and counseling related to aspirin use, tobacco
cessation, and obesity.
3. Estimated Number of Affected Entities
For purposes of the new requirements in the Affordable Care Act
that apply to group health plans and health insurance issuers in the
group and individual markets, the Departments have defined a large
group health plan as an employer plan with 100 or more workers and a
small group plan as an employer plan with less than 100 workers. The
Departments estimated that there are approximately 72,000 large and 2.8
million small ERISA-covered group health plans with an estimated 97.0
million participants in large group plans and 40.9 million participants
in small group plans.\6\ The Departments estimate that there are
126,000 governmental plans with 36.1 million participants in large
plans and 2.3 million participants in small plans.\7\ The Departments
estimate there are 16.7 million individuals under age 65 covered by
individual health insurance policies.\8\
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\6\ All participant counts and the estimates of individual
policies are from the U.S. Department of Labor, EBSA calculations
using the March 2008 Current Population Survey Annual Social and
Economic Supplement and the 2008 Medical Expenditure Panel Survey.
\7\ Estimate is from the 2007 Census of Government.
\8\ US Census Bureau, Current Population Survey, March 2009.
---------------------------------------------------------------------------
As described in the Departments' interim final regulations relating
to status as a grandfathered health plan,\9\ the Affordable Care Act
preserves the ability of individuals to retain coverage under a group
health plan or health insurance coverage in which the individual was
enrolled on March 23, 2010 (a grandfathered health plan). Group health
plans, and group and individual health insurance coverage, that are
grandfathered health plans do not have to meet the requirements of
these interim final regulations. Therefore, only plans and issuers
offering group and individual health insurance coverage that are not
grandfathered health plans will be affected by these interim final
regulations.
---------------------------------------------------------------------------
\9\ 75 FR 34538 (June 17, 2010).
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[[Page 41732]]
Plans can choose to relinquish their grandfather status in order to
make certain otherwise permissible changes to their plans.\10\ The
Affordable Care Act provides plans with the ability to maintain
grandfathered status in order to promote stability for consumers while
allowing plans and sponsors to make reasonable adjustments to lower
costs and encourage the efficient use of services. Based on an analysis
of the changes plans have made over the past few years, the Departments
expect that more plans will choose to make these changes over time and
therefore the number of grandfathered health plans is expected to
decrease. Correspondingly, the number of plans and policies affected by
these interim final regulations is likely to increase over time. In
addition, the number of individuals receiving the benefits of the
Affordable Care Act is likely to increase over time. The Departments'
mid-range estimate is that 18 percent of large employer plans and 30
percent of small employer plans would relinquish grandfather status in
2011, increasing over time to 45 percent and 66 percent respectively by
2013, although there is substantial uncertainty surrounding these
estimates.\11\
---------------------------------------------------------------------------
\10\ See 75 FR 34538 (June 17, 2010).
\11\ See 75 FR 34538 (June 17, 2010) for a detailed description
of the derivation of the estimates for the percentages of
grandfathered health plans. In brief, the Departments used data from
the 2008 and 2009 Kaiser Family Foundations/Health Research and
Educational Trust survey of employers to estimate the proportion of
plans that made changes in cost-sharing requirements that would have
caused them to relinquish grandfather status if those same changes
were made in 2011, and then applied a set of assumptions about how
employer behavior might change in response to the incentives created
by the grandfather regulations to estimate the proportion of plans
likely to relinquish grandfather status. The estimates of changes in
2012 and 2013 were calculated by using the 2011 calculations and
assuming that an identical percentage of plan sponsors will
relinquish grandfather status in each year.
---------------------------------------------------------------------------
Using the mid-range assumptions, the Departments estimate that in
2011, roughly 31 million people will be enrolled in group health plans
subject to the prevention provisions in these interim final
regulations, growing to approximately 78 million in 2013.\12\ The mid-
range estimates suggest that approximately 98 million individuals will
be enrolled in grandfathered group health plans in 2013, many of which
already cover preventive services (see discussion of the extent of
preventive services coverage in employer-sponsored plans later in this
preamble).
---------------------------------------------------------------------------
\12\ To estimate the number of individuals covered in
grandfathered health plans, the Departments extended the analysis
described in 75 FR 34538, and estimated a weighted average of the
number of employees in grandfathered health plans in the large
employer and small employer markets separately, weighting by the
number of employees in each employer's plan. Estimates for the large
employer and small employer markets were then combined, using the
estimates supplied above that there are 133.1 million covered lives
in the large group market, and 43.2 million in the small group
market.
---------------------------------------------------------------------------
In the individual market, one study estimated that 40 percent to 67
percent of individual policies terminate each year. Because all newly
purchased individual policies are not grandfathered, the Departments
expect that a large proportion of individual policies will not be
grandfathered, covering up to and perhaps exceeding 10 million
individuals.\13\
---------------------------------------------------------------------------
\13\ Adele M. Kirk. The Individual Insurance Market: A Building
Block for Health Care Reform? Health Care Financing Organization
Research Synthesis. May 2008.
---------------------------------------------------------------------------
However, not all of the individuals potentially affected by these
interim final regulations will directly benefit given the prevalence
and variation in insurance coverage today. State laws will affect the
number of entities affected by all or some provision of these interim
final regulations, since plans, policies, and enrollees in States that
already have certain requirements will be affected to different
degrees.\14\ For instance, 29 States require that health insurance
issuers cover most or all recommended immunizations for children.\15\
Of these 29 States, 18 States require first-dollar coverage of
immunizations so that the insurers pay for immunizations without a
deductible and 12 States exempt immunizations from copayments (e.g.,
$5, $10, or $20 per vaccine) or coinsurance (e.g., 10 percent or 20
percent of charges). State laws also require coverage of certain other
preventive health services. Every State except Utah mandates coverage
for some type of breast cancer screening for women. Twenty-eight States
mandate coverage for some cervical cancer screening and 13 States
mandate coverage for osteoporosis screening.\16\
---------------------------------------------------------------------------
\14\ Of note, State insurance requirements do not apply to self-
insured group health plans, whose participants and beneficiaries
make up 57 percent of covered employees (in firms with 3 or more
employees) in 2009 according to a major annual survey of employers
due to ERISA preemption of State insurance laws. See e.g., Kaiser
Family Foundation and Health Research and Education Trust, Employer
Health Benefits 2009 Annual Survey (2009).
\15\ See e.g., American Academy of Pediatrics, State Legislative
Report (2009).
\16\ See Kaiser Family Foundation, www.statehealthfacts.org.
---------------------------------------------------------------------------
Estimation of the number of entities immediately affected by some
or all provisions of these interim final regulations is further
complicated by the fact that, although not all States require insurance
coverage for certain preventive services, many health plans have
already chosen to cover these services. For example, most health plans
cover most childhood and some adult immunizations contained in the
recommendations from the Advisory Committee. A survey of small, medium
and large employers showed that 78 percent to 80 percent of their point
of service, preferred provider organization (PPO), and health
maintenance organization (HMO) health plans covered childhood
immunizations and 57 percent to 66 percent covered influenza vaccines
in 2001.\17\ All 61 health plans (HMOs and PPOs) responding to a 2005
America's Health Insurance Plans (AHIP) survey covered childhood
immunizations \18\ in their best-selling products and almost all health
plans (60 out of 61) covered diphtheria-tetanus-pertussis vaccines and
influenza vaccines for adults.\19\ A survey of private and public
employer health plans found that 84 percent covered influenza vaccines
in 2002-2003.\20\
---------------------------------------------------------------------------
\17\ See e.g., Mary Ann Bondi et. al., ``Employer Coverage of
Clinical Preventive Services in the United States,'' American
Journal of Health Promotion, 20(3), pp. 214-222 (2006).
\18\ The specific immunizations include: DTaP (diphtheria and
tetanus toxoids and acellular Pertussis), Hib (Haemophilus influenza
type b), Hepatitis B, inactivated polio, influenza, MMR (measles,
mumps, and rubella), pneumococcal, and varicella vaccine.
\19\ McPhillips-Tangum C., Rehm B., Hilton O. ``Immunization
practices and policies: A survey of health insurance plans.'' AHIP
Coverage. 47(1), 32-7 (2006).
\20\ See e.g., Matthew M. Davis et. al., ``Benefits Coverage for
Adult Vaccines in Employer-Sponsored Health Plans,'' University of
Michigan for the CDC National Immunizations Program (2003).
---------------------------------------------------------------------------
Similarly, many health plans already cover preventive services
today, but there are differences in the coverage of these services in
the group and individual markets. According to a 2009 survey of
employer health benefits, over 85 percent of employer-sponsored health
insurance plans covered preventive services without having to meet a
deductible.\21\ Coverage of preventive services does vary slightly by
employer size, with large employers being more likely to cover such
services than small employers.\22\ In contrast, coverage of preventive
services is less prevalent and varies more significantly in the
individual market.\23\ For PPOs,
[[Page 41733]]
only 66.2 percent of single policies purchased covered adult physicals,
while 94.1 percent covered cancer screenings.\24\
---------------------------------------------------------------------------
\21\ See e.g., Kaiser Family Foundation and Health Research and
Education Trust, Employer Health Benefits 2009 Annual Survey (2009)
available at https://ehbs.kff.org/pdf/2009/7936.pdf.
\22\ See e.g., Mary Ann Bondi et. al., ``Employer Coverage of
Clinical Preventive Services in the United States,'' American
Journal of Health Promotion, 20(3), pp. 214-222 (2006).
\23\ See e.g., Matthew M. Davis et. al., ``Benefits Coverage for
Adult Vaccines in Employer-Sponsored Health Plans,'' University of
Michigan for the CDC National Immunizations Program (2003).
\24\ See Individual Health Insurance 2006-2007: A Comprehensive
Survey of Premiums, Availability, and Benefits. Available at https://www.ahipresearch.org/pdfs/Individual_Market_Survey_December_2007.pdf.
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In summary, the number of affected entities depends on several
factors, such as whether a health plan retains its grandfather status,
the number of new health plans, whether State benefit requirements for
preventive services apply, and whether plans or issuers voluntarily
offer coverage and/or no cost sharing for recommended preventive
services. In addition, participants, beneficiaries, and enrollees in
such plans or health insurance coverage will be affected in different
ways: Some will newly gain coverage for recommended preventive
services, while others will have the cost sharing that they now pay for
such services eliminated. As such, there is considerable uncertainty
surrounding estimation of the number of entities affected by these
interim final regulations.
4. Benefits
The Departments anticipate that four types of benefits will result
from these interim final regulations. First, individuals will
experience improved health as a result of reduced transmission,
prevention or delayed onset, and earlier treatment of disease. Second,
healthier workers and children will be more productive with fewer
missed days of work or school. Third, some of the recommended
preventive services will result in savings due to lower health care
costs. Fourth, the cost of preventive services will be distributed more
equitably.
By expanding coverage and eliminating cost sharing for recommended
preventive services, these interim final regulations could be expected
to increase access to and utilization of these services, which are not
used at optimal levels today. Nationwide, almost 38 percent of adult
residents over 50 have never had a colorectal cancer screening (such as
a sigmoidoscopy or a colonoscopy) \25\ and almost 18 percent of women
over age 18 have not been screened for cervical cancer in the past
three years.\26\ Vaccination rates for childhood vaccines are generally
high due to State laws requiring certain vaccinations for children to
enter school, but recommended childhood vaccines that are not subject
to State laws and adult vaccines have lower vaccination rates (e.g.,
the meningococcal vaccination rate among teenagers is 42 percent).\27\
Studies have shown that improved coverage of preventive services leads
to expanded utilization of these services,\28\ which would lead to
substantial benefits as discussed further below.
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\25\ This differs from the Task Force recommendation that
individuals aged 50-75 receive fecal occult blood testing,
sigmoidoscopy, or colonoscopy screening for colorectal cancer.
\26\ For Behavioral Risk Factor Surveillance System Numbers see
e.g. Centers for Disease Control and Prevention (CDC). Behavioral
Risk Factor Surveillance System Survey Data. Atlanta, Georgia: U.S.
Department of Health and Human Services, Centers for Disease Control
and Prevention, (2008) at https://apps.nccd.cdc.gov/BRFSS/page.asp?cat=CC&yr=2008&state=UB#CC.
\27\ See https://www.cdc.gov/vaccines/stats-surv/imz-coverage.htm#nis for vaccination rates.
\28\ See e.g., Jonathan Gruber, The Role of Consumer Copayments
for Health Care: Lessons from the RAND Health Insurance Experiment
and Beyond, Kaiser Family Foundation (Oct. 2006). This paper
examines an experiment in which copays randomly vary across several
thousand individuals. The author finds that individuals are
sensitive to prices for health services--i.e. as copays decline,
more services are demanded. See e.g., Sharon Long, ``On the Road to
Universal Coverage: Impacts of Reform in Massachusetts At One
Year,'' Health Affairs, Volume 27, Number 4 (June 2008). The author
investigated the case of Massachusetts, where coverage of preventive
services became a requirement in 2007, and found that for
individuals under 300 percent of the poverty line, doctor visits for
preventive care increased by 6.1 percentage points in the year after
adoption, even after controlling for observable characteristics.
Additionally, the incidence of individuals citing cost as the reason
for not receiving preventive screenings declined by 2.8 percentage
points from 2006 to 2007. In the Massachusetts case, these
preventive care services were not necessarily free; therefore,
economists would expect a higher differential under these interim
final rules because of the price sensitivity of health care usage.
---------------------------------------------------------------------------
In addition, these interim final regulations limit preventive
service coverage under this provision to services recommended by the
Task Force, Advisory Committee, and HRSA. The preventive services given
a grade of A or B by the Task Force have been determined by the Task
Force to have at least fair or good \29\ evidence that the preventive
service improves important health outcomes and that benefits outweigh
harms in the judgment of an independent panel of private sector experts
in primary care and prevention.\30\ Similarly, the mission of the
Advisory Committee is to provide advice that will lead to a reduction
in the incidence of vaccine preventable diseases in the United States,
and an increase in the safe use of vaccines and related biological
products. The comprehensive guidelines for infants, children, and
adolescents supported by HRSA are developed by multidisciplinary
professionals in the relevant fields to provide a framework for
improving children's health and reducing morbidity and mortality based
on a review of the relevant evidence. The statute and interim final
regulations limit the preventive services covered to those recommended
by the Task Force, Advisory Committee, and HRSA because the benefits of
these preventive services will be higher than others that may be
popular but unproven.
---------------------------------------------------------------------------
\29\ The Task Force defines good and fair evidence as follows.
Good: Evidence includes consistent results from well-designed, well-
conducted studies in representative populations that directly assess
effects on health outcomes.
Fair: Evidence is sufficient to determine effects on health
outcomes, but the strength of the evidence is limited by the number,
quality or consistency of the individual studies, generalizability
to routine practice or indirect nature of the evidence on health
outcomes. See https://www.ahrq.gov/clinic/uspstf/gradespre.htm#drec.
\30\ See https://www.ahrq.gov/clinic/uspstf/gradespre.htm#drec
for details of the Task Force grading.
---------------------------------------------------------------------------
Research suggests significant health benefits from a number of the
preventive services that would be newly covered with no cost sharing by
plans and issuers under the statute and these interim final
regulations. A recent article in JAMA stated, ``By one account,
increasing delivery of just five clinical preventive services would
avert 100,000 deaths per year.'' \31\ These five services are all items
and services recommended by the Task Force, Advisory Committee, and/or
the comprehensive guidelines supported by HRSA. The National Council on
Prevention Priorities (NCPP) estimated that almost 150,000 lives could
potentially be saved by increasing the 2005 rate of utilization to 90
percent for eight of the preventive services recommended by the Task
Force or Advisory Committee.\32\ Table 2 shows eight of the services
and the number of lives potentially saved if utilization of preventive
services were to increase to 90 percent.
---------------------------------------------------------------------------
\31\ Woolf, Steven. A Closer Look at the Economic Argument for
Disease Prevention. JAMA 2009;301(5):536-538.
\32\ See National Commission on Prevention Priorities.
Preventive Care: A National Profile on Use, Disparities, and Health
Benefits. Partnership for Prevention, August 2007 at https://www.prevent.org/content/view/129/72/#citations accessed on 6/22/
2010. Lives saved were estimated using models previously developed
to rank clinical preventive services. See Maciosek MV, Edwards NM,
Coffield AB, Flottemesch TJ, Nelson WW, Goodman MJ, Rickey DA,
Butani AB, Solberg LI. Priorities among effective clinical
preventive services: methods. Am J Prev Med 2006; 31(1):90-96.
[[Page 41734]]
TABLE 2.--Lives Saved From Increasing Utilization of Selected Preventive Services to 90 Percent
----------------------------------------------------------------------------------------------------------------
Lives saved
annually if
Percent percent
utilizing utilizing
Preventive service Population group preventive preventive
service in 2005 service
increased to 90
percent
----------------------------------------------------------------------------------------------------------------
Regular aspirin use....................... Men 40+ and women 50+........... 40 45,000
Smoking cessation advice and help to quit. All adult smokers............... 28 42,000
Colorectal cancer screening............... Adults 50+...................... 48 14,000
Influenza vaccination..................... Adults 50+...................... 37 12,000
Cervical cancer screening in the past 3 Women 18-64..................... 83 620
years.
Cholesterol screening..................... Men 35+ and women 45+........... 79 2,450
Breast cancer screening in the past 2 Women 40+....................... 67 3,700
years.
Chlamydia screening....................... Women 16-25..................... 40 30,000
----------------------------------------------------------------------------------------------------------------
Source: National Comm
