Comprehensive Healthcare Reform Becomes Law

Home > Articles > Comprehensive Healthcare Reform Becomes Law
By Peter W. Thomas, JD, and Adam Chrisney

After the election of Senator Scott Brown (R-MA) at the beginning of the year and the resulting loss of a Democratic super-majority (60 votes) in the Senate, it looked as if Democrats were faced with failure on a top 2008 campaign priority. In the face of unified opposition from the Republican Party and growing concerns about the upcoming November elections, the White House gave serious consideration to three alternatives: press forward with a comprehensive bill, scale back the bill dramatically and enact a less ambitious plan, or jettison health reform altogether and pivot toward a focus on employment and the overall economy.

In the end, President Obama—to use poker parlance—went "all in." The Democratic-led Congress and the White House chose to abandon any hope of bipartisan efforts and pressed forward with their existing bill, working their way through a complicated legislative process that had left them with little margin for error in solidifying support within their own party. Furthermore, their delicate maneuvering on such a complex legislative package came at a time when the American public is demanding transparency and accountability in Congressional decision-making. Yet supporters of the bill were able to eke out enough votes to pass a House package and stave off minority opposition in the Senate to pass this Democratic priority.

Specifically, on March 21, 2010, the House took the first step by passing the Senate-passed health-reform bill, the Patient Protection and Affordable Care Act (PPACA), and then immediately afterward passed a reconciliation bill (H.R. 4872) by a vote of 220 to 211. The reconciliation bill made significant changes to the Senate healthcare-reform legislation (H.R. 3590) that had just been approved by the House. No Republicans voted for either the Senate bill or the House reconciliation bill, and 33 Democrats joined them in opposing the latter. On March 25, the Senate passed a health-reform reconciliation bill (H.R. 4872) by a vote of 56 to 43, making slight changes that required a further House vote, but the package had essentially cleared all hurdles and was signed by President Obama on March 30.

President Barack Obama signs the health insurance reform bill in the East Room of the White House, March 23, 2010. Official White House photo by Chuck Kennedy.

While it is not yet clear how significantly the push to enact comprehensive healthcare reform will impact the Democratic House and Senate margins in the coming elections, President Obama and Democrats in the House and Senate have achieved a significant Democratic party goal by enacting healthcare reform. In the near term, however, a serious disagreement is already brewing, as U.S. Department of Health & Human Services (HHS) Secretary Kathleen Sebelius has had harsh words for some insurance companies and their treatment of children just days after the bill's passage. Sebelius pointed to "recent media accounts" that some plans intended to only cover pre-existing conditions if a child already has health insurance. The law was intended to extend guaranteed issue protections starting in September to all children with pre-existing conditions (adults will have to wait until 2014 to be guaranteed insurance coverage regardless of any pre-existing conditions).

This dispute, which flared up within the first few days of passage of the overall bill, may be a harbinger of things to come as insurers and perhaps providers battle with HHS and the Centers for Medicare & Medicaid Services (CMS) over the meaning of each major provision in the just-passed 1,000-page bill. Priority concerns for the O&P profession, of course, include coverage of O&P in the essential benefit package provided by health plans as well as the definition of O&P in relation to durable medical equipment (DME), and the importance of keeping those definitions separate and distinct.

O&P Coverage in the Essential Benefit Package

President Barack Obama's signature on the health insurance reform bill at the White House, March 23, 2010. The President signed the bill with 22 different pens. Official White House photo by Chuck Kennedy.

The final health-reform law includes categories of benefits in the standard benefit package that all private plans participating in the new "Health Insurance Exchange" must cover starting in 2014. As a result of Congress using the reconciliation process to pass the final version of health reform, many provisions had to be gutted from the final bill. The specific coverage references that the National Association for the Advancement of Orthotics and Prosthetics (NAAOP) and the O&P Alliance fought so hard to have included in the House bill—i.e., "durable medical equipment, prosthetics, orthotics, and related supplies"—were not included in the final bill. Instead, the new law references "rehabilitative and habilitative services and devices" in the benefit package.

There is strong evidence that O&P care is covered within this definition, and there is now evidence in the legislative history to this effect as well. During the House debate of the Senate-passed health-reform bill, Chairman George Miller (D-CA) of the House Committee on Education and Labor inserted a statement into the Congressional record that states unequivocally that O&P care is considered covered under "rehabilitative and habilitative services and devices." This language is not binding, however, so the O&P community will have to be actively involved in the regulatory process as HHS begins the task of drafting regulations for this new law.

O&P Definition

The new law requires HHS to develop a standard definition of "durable medical equipment" as well as a number of other common terms so the benefit can easily be compared among plans. While there is not anything wrong with this provision per se, there is serious concern that HHS will define O&P care under the broad term, "durable medical equipment." For obvious reasons, this would be a major problem. Categorizing O&P care under the definition as DME would apply a spectrum of rules intended for DME to a field that is very different in critical respects and would likely cause major problems for patients when trying to access artificial limbs and orthopedic braces. Many benefit exclusions, caps on benefits, and eligibility rules to obtain DME are completely misapplied to O&P care.

The O&P field was poised to make significant clarifications to this and other provisions in the conference committee bill, but the reconciliation process derailed that strategy. In the end, Chairman Miller once again spoke to this issue on the House floor. His statement was printed in the Congressional record and helped inform the legislative history of the health-reform package. Chairman Miller's statement to define O&P separately from DME will allow the O&P community to argue that this separation is consistent with Congressional intent. The O&P community will have to continue to engage HHS and CMS during the regulatory process to ensure that O&P is defined separately from DME.

O&P Productivity Adjustment

The new law did not explicitly reduce the Medicare O&P fee schedule for any year during the ten-year budget window of the bill. Because many providers such as hospitals, DME suppliers, and many other settings of care received direct payment cuts, it has to be viewed as a victory that the O&P fee schedule was largely spared. However, the bill did include a Senate provision, which, as part of the market-basket cuts applied to various inpatient providers, incorporates a "productivity adjustment" to payment updates for Part B providers that do not already have such an adjustment written into the new law itself.

The provision was opposed by the O&P community on the grounds that it would achieve only very modest federal savings while potentially compromising the ability of O&P practitioners to provide highly customized and specialized care to amputees and beneficiaries with orthopedic impairments in need of orthotic bracing and prosthetic limbs. Additional work will need to be through the Congress and the Administration to refine the negative impact that may occur through this productivity adjustment.

Preliminary Conclusion

The healthcare-reform bill that just became law is a complex piece of legislation that will continue to produce surprises, both good and bad, for major stakeholders in healthcare. As more analysis on the bill is conducted, the specific impact of many of the reforms on the O&P field will become more apparent.

Peter W. Thomas, JD, serves as general counsel for the National Association for the Advancement of Orthotics and Prosthetics (NAAOP). Adams Chrisney is the senior legislative director at Powers Pyles Sutter & Verville, PC, Washington DC.