HHS "Corrects" Obamacare Rule, Waives Comment Period and 30-Day Delay

    On New Year's Eve day, a Department of Health and Human Services (HHS) rule correction was entered in the Federal Register related to an Affordable Care Act rule that had been finalized two months earlier.  The published version of the rule entitled (in part) ‘‘Patient Protection and Affordable Care Act; Program Integrity" , subpart M (‘‘Oversight and Program Integrity Standards for State Exchanges’’), failed to include a cross-reference to the small business health options program (SHOP) Exchanges section of the regulations. This "technical nonconformity" meant that SHOP's were not subject to the new rule.  Since HHS believed the intent of the original rule was clear, the correction was made without the usual comment period and 30-day delay before the rule would take effect in 2014.
    The substance of the correction is explained in the Federal Register as follows:

On page 65095, in the Federal Register of October 30, 2013, we added subpart M ‘‘Oversight and Program Integrity Standards for State Exchanges’’ to the regulations text at 45 CFR part 155. While it was clear from the preamble and regulations text that subpart M applies to all Exchanges, including small business health options program (SHOP) Exchanges, due to an oversight we inadvertently omitted cross-referencing new subpart M at § 155.705(a) of the regulations in part 155, subpart H—Exchange Functions: Small Business Health Options Program. Accordingly, we are revising § 155.705(a) so that the regulations in part 155 consistently reflect our policy that all Exchanges, including SHOP Exchanges, must carry out the required functions of an Exchange that are set forth at subpart M. We are correcting § 155.705(a) by adding a cross reference to subpart M, so that the provision reads, ‘‘Exchange functions that apply to SHOP’’. The SHOP must carry out all the required functions of an Exchange described in this subpart and in subparts C, E, K, and M of this part, except..."

    The notice explains that the comment period and 30-day delay may be waived "if the Secretary finds for good cause that the delay is impracticable, unnecessary, or contrary to the public interest, and incorporates a statement of the findings and the reasons therefor in the rule issued."
    In late November, the Obama administration announced that online enrollment for the federally facilitated SHOP's would be delayed for a year due to problems with the Healthcare.gov site.  The SHOP program, however, is still available to businesses through brokers, and is also available for businesses in states operating their own online insurance exchanges.


Note: A version of this article first appeared at The Weekly Standard.