States Drag Their Feet on Health Consumer Protection

Some of the most important consumer protection reforms in the Affordable Care Act (ACA), such as coverage for people with preexisting medical conditions, have yet to be provided by 39 states, according to a report by the nonpartisan Commonwealth Fund. The report highlights a critical issue just 11 months before the reforms are scheduled to take effect under the ACA, also called Obamacare. Since only 11 states have taken action to implement new consumer safeguards under this healthcare law, the report raises questions about how major health insurance reforms will be enforced.

The law will expand health coverage to more than 30 million people starting January 1, 2014, accomplished partly by creating new state online health insurance exchanges, or markets. Millions of Americans stand to benefit next year from protections in the ACA, which also restricts how much health insurers can charge older individuals, bans coverage waiting periods, requires health plans to cover a basic set of minimum benefits, and sets limits for out-of-pocket consumer costs.

What happens if the states do not pass the reforms, or enact their own state laws for these protections? Even though states can use existing powers to enforce many of the Affordable Care Act’s requirements, it is questionable how effectively states can enforce all of them without new or expanded legal authority. The federal government could step in to guarantee these consumer protection reforms, but that would require the Obama Administration to fundamentally control significant parts of insurance markets that are typically state-regulated. State lawmakers who want to keep local control will need to move on these laws this year, noted the report’s author.

The Commonwealth Fund, a private foundation which focuses on ways to improve the U.S. healthcare system, found in their analysis that only one state has passed new legislation on all of these protections. An additional 10 states and the District of Columbia have passed new legislation or issued a new regulation on at least one consumer protection. The findings imply an urgent need for states to take action in 2013 to ensure that consumers fully benefit from the healthcare law’s reforms.

Click here to read the article about this report in the LA Times, and click here to read the Commonwealth Fund’s report.

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