Aetna 2008 Annual Report Download - page 32

Annual Report - Page 27
Legislative and Regulatory Initiatives
There has been a continuing trend of increased legislative activity concerning health care reform and regulation at
both the federal and state levels. For example, Massachusetts has enacted comprehensive reform, including an
individual health coverage mandate. A number of other state legislatures have contemplated but have not yet
enacted significant reform of their health insurance markets. In 2009, we expect a number of states to consider an
individual health coverage mandate and a number of states to consider an employer health care mandate. Other
states are expected to consider these types of reforms as well as more modest reforms aimed at expanding Medicaid
and SCHIP eligibility. These proposals include provisions affecting both public programs and privately-financed
health insurance arrangements, and some of these proposals could have the longer-term effect of materially altering
the current role of employers in providing health benefits. Broadly stated, these proposals attempt to increase the
number of insured by expanding eligibility for Medicaid and other public programs and compelling individuals and
employers to purchase health insurance coverage. At the same time, these proposals could change the underwriting
and marketing practices of health plans, for example by placing restrictions on pricing and mandating minimum
medical benefit ratios.
Legislation, regulation and initiatives relating to this continuing trend include among other things, the following:
• Amending or supplementing ERISA to impose greater requirements on the administration of employer-
funded benefit plans or limit the scope of current ERISA pre-emption, which would among other things
expose us and other health plans to expanded liability for punitive and other extra-contractual damages and
additional state regulation
• Imposing assessments on (or to be collected by) health plans or health carriers, which may or may not be
passed onto their customers. These assessments may include assessments for insolvency, assessments for
uninsured or high-risk pools, assessments for uncompensated care, or assessments to defray provider
medical malpractice insurance costs.
• Reducing government funding of government-sponsored health programs in which we participate.
• Mandating minimum medical benefit ratios or otherwise restricting health plans’ profitability.
• Extending malpractice and other liability exposure for decisions made by health plans.
• Mandating coverage for certain conditions and/or specified procedures, drugs or devices (for example,
treatment for autism and infertility and experimental pharmaceuticals).
• Mandating expanded employer and consumer disclosures and notices.
• Regulating e-connectivity.
• Mandating health insurance access and/or affordability.
• Mandating or regulating the disclosure of provider fee schedules and other data about our payments to
providers.
• Mandating or regulating disclosure of provider outcome and/or efficiency information.
• Imposing substantial penalties for our failure to pay claims within specified time periods.
• Imposing payment levels for services rendered to our members by providers who do not have contracts with
us.
• Exempting physicians from the antitrust laws that prohibit price fixing, group boycotts and other horizontal
restraints on competition.
• Restricting health plan claim processing, review, payment and related procedures.
• Mandating internal and external grievance and appeal procedures (including expedited decision making and
access to external claim review).
• Enabling the creation of new types of health plans or health carriers, which in some instances would not be
subject to the regulations or restrictions that govern our operations.
• Allowing individuals and small groups to collectively purchase health care coverage without any other
affiliations.
• Imposing requirements and restrictions on operations of pharmacy benefit managers, including restricting or
eliminating the use of formularies for prescription drugs or the use of average wholesale price.
• Creating or expanding state-sponsored health benefit purchasing pools, in which we may be required to
participate.
• Creating a single payer system where the government oversees or manages the provision of health care
coverage.
• Imposing requirements and restrictions on consumer-driven health plans and/or health savings accounts.