Senate Rejects Effort To Remove ‘Grandfathering’ Rules From Reform Law

On Wednesday, the Senate voted 40-59 to reject a Republican-sponsored measure that would have overturned the "grandfathering" rules for some health insurance plans under the federal health reform law, The Hill's "Healthwatch" reports (Pecquet, "Healthwatch," The Hill, 9/29).

The rules, which the Obama administration issued in June, exempt plans that were being offered before the law was enacted from certain consumer protections (Lubell, Modern Healthcare, 9/29).

For example, grandfathered plans are exempt from limits on cost-sharing. They also are not required to comply with mandates that plans offer preventive care without copayments or requirements that they institute an appeals process for disputed claims following guidelines stipulated in the overhaul.

However, they could lose their grandfather status if they make significant changes in deductibles, copays or benefits (California Healthline, 6/14).

Sen. Mike Enzi (R-Wyo.), who sponsored the resolution, and other supporters said the rules were too restrictive and would force many businesses to drop their existing plans (Lesniewski, CQ Today, 9/29).

Enzi said he proposed the resolution to hold President Obama to his frequent promise during the reform debate that consumers would be able to keep their existing health insurance plans if they liked them.

Senate Minority Leader Mitch McConnell (R-Ky.) said the GOP would revisit the issue at a later time (McCarthy, CongressDaily, 9/29).

Reaction Before, After Vote

Before the vote, the White House warned that approval of the resolution would roll back important consumer protections and cause disruptions in the workplace.

A Statement of Administration Policy issued by the Office of Management and Budget said, "By dismantling the (regulation) that set out the conditions ... for 'grandfather' status, the resolution would limit individuals' and businesses' choice to keep the plan they had in place when [the reform law] was enacted" (CongressDaily, 9/29).

The statement said the measure "would result in significant uncertainty as to what kind of changes may be made to coverage without a loss of grandfather status" ("Healthwatch," The Hill, 9/29).

OMB also warned that Obama would veto the proposal if it reached his desk (CQ Today, 9/29).

Some Democratic leaders called the measure a political stunt ahead of the November midterm elections (CongressDaily, 9/29).