In praise of HIPAA

We live in the days of the preplexingly ascendent “tea party” “movement”. I feel this thing is neither a “movement”, as in “civil-rights movement”, nor is it in the same spirit of Samuel Adams’s Boston Tea Party. In any case, thanks to this thing, it has become very fashionable to bash all legislation (especially health care legislation) as “intrusive”, “unconstitutional”, “un-American”, and many other undesirable labels. I recall such bashing when the Kennedy-Kassebaum act of 1996 (aka Health Insurance Portability and Accountability Act aka HIPAA) came around. This act was the compromise legislation that was passed when Hillary Clinton’s much more humane (but likely impractical) program was thwarted. This blog entry is my statement of thanks for one small but personally very significant part of HIPAA.

I have chronic asthma and must take expensive tier-III medication every day to remain symptom free. During those rare times when my symptoms get severly out of control, I am unable to fulfill my duties as a productive member of society (aka “working for the man”). Therefore, it is in the best interest of society as a whole to minimize those symptomatic outbreaks.

Consider the following points.

• The act of taking out an insurance policy is essentially a wager.




• A health insurance policy is usually a pretty unfavorable wager for the insurer, considering the state of general healthfulness in the America.




• The business of America is, always has been, and always
  will be, business .

In light of these points it is not surprising that the insurer has a right to adjust the odds. In fairness, it is hard to deny them that right, especially when you consider that corporations are in fact legal persons, with all the rights (but few of the responsibilities) of human people. One way insurers adjust the odds is to make coverage more expensive for smokers, drinkers, overweight, etc. Again, that’s fair to me. You can choose not to smoke or drink, and choose to eat less. One odds-adjusting technique with which I strongly disagree is the “preexisting condition exclusion”. This basically means that if you’re already seriously sick, say with cancer, or asthma, the insurer has a right to deny you coverage because, in fact, the odds are that they’ll have to pay out on your policy. It’s hard to make a profitable business out of those kinds of wagers! Here's where the Kennedy-Kassebaum Act of 1996 comes in.

This law was sponsored by Democrat Edward Kennedy and Republican Nancy Kassebaum and includes a clause that says that if you’ve had continuous coverage for 12 months and then switch insurers, the new insurer cannot deny you coverage based on having a pre-existing condition.

In Sec. 54.9801-3 (a)(2)(iii) of the 2004 final HIPAA portability regulations, published in the Federal Register on December 30, 2004 (69 FR 78720), you’ll find the following text.

    (B) The rules of this paragraph (a)(2)(iii) are illustrated by the 
following example:
    Example.  (i) Facts. Individual D works for Employer X and has 
been covered continuously under X's group health plan. D's spouse 
works for Employer Y. Y maintains a group health plan that imposes a 
12-month preexisting condition exclusion (reduced by creditable 
coverage) on all new enrollees. D enrolls in Y's plan, but also 
stays covered under X's plan. D presents Y's plan with evidence of 
creditable coverage under X's plan.
    (ii) Conclusion. In this Example, Y's plan must reduce the 
preexisting condition exclusion period that applies to D by the 
number of days of coverage that D had under X's plan as of D's 
enrollment date in Y's plan (even though D's coverage under X's plan 
was continuing as of that date).

In my case, instead of switching from my plan to my spouse’s plan, I’m switching from Sun Microsystems’s plan to Oracle’s plan (both of which offer my current insurer, United Healthcare). So, thanks to the Kennedy (liberal elite mastermind)-Kassebaum (RINO) Act, I don’t have to lose a day of faithful service to the man. How can the members of the so-called “tea party” “movement” disagree with the economic soundness (aka patriotism) of that?

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