Blue Cross 

Blue Shield 

of Michigan 

600 E. Lafayette Blvd. 

Detroit, Michigan 48226-2998 

August 10, 2010 

Office of Consumer Information and Insurance Oversight

U.S. Department of Health and Human Services 

Attention: OCIIO-9994-IFC 

P.O. Box 8016 

Baltimore, MD 21244-1850

RE: File code OCIIO-9994-IFC, Interim Final Regulation on pre-existing 

 condition exclusions for children under age 19 

To Whom It May Concern: 

On behalf of Blue Cross Blue Shield of Michigan (BCBSM), I thank you for the 

opportunity to comment on the Patient Protection and Affordable Coverage Act of 

2010 (PPACA) interim final regulation which requires health insurance issuers to 

provide coverage for children who have pre-existing medical conditions. I am 

sorry to say that we are disappointed with your recent announcement that issuers 

in the individual market may restrict enrollment of children to specific open 

enrollment periods—without ensuring that all insurance issuers are treated 

equally and fairly in the implementation of PPACA, which is a tenet of the law.

On June 28, 2010, the U.S. Department of Health and Human Services (HHS) 

published interim final regulations prohibiting insurance issuers in both the group 

and individual markets from imposing pre-existing condition exclusions on 

children under age 19 for the first plan year beginning on or after September 23, 

2010. This appeared to require continual guarantee issue of policies—a strong 

consumer protection principle. For Michigan and some other states, this 

regulation would have instituted true competition and a level playing field that 

would have positively impacted the market for many families. Currently, the only 

insurance issuer that guarantee issues policies for all comers in Michigan is Blue 

Cross Blue Shield of Michigan (BCBSM). 

One month later, on July 27, 2010, HHS released a Frequently Asked Questions 

document announcing that issuers in the individual market may determine the 

number and length of open enrollment periods for children under age 19. HHS 

also noted that if a state requires continuous open enrollment or requires issuers 

to maintain an open enrollment period of a particular length or open enrollment 

periods of a particular frequency, then the State requirement will apply. This is of 

concern to us because one key intent of the PPACA insurance market reforms is 

to create a more level, balanced playing field among health plans to foster 
competition and choice, and to limit adverse selection, or “cherry picking.”--which 

will help stabilize prices for consumers and create more affordable coverage 

options. 

BCBSM has acted as the model that Congress established in PPACA, 

particularly by offering continual guarantee issue and community rating so that 

consumers are protected. It is clear that Congress intended to create a 

competitive and level playing field so that consumers are protected. In fact, 

Section 1252 of PPACA deals with rating reforms applying uniformly to all health 

insurance issuers and group health plans. 

The purpose of Section 1252 is to ensure that all health insurance issuers are 

regulated equally to promote competition and more affordable coverage. Equal 

regulation means that all carriers are subject to the same rules. 

We understand that Section 1252 was placed in a section that applies in 2014, 

but the intent of the level playing cannot be understated; a key tenet of PPACA 

was to establish a system that is affordable and not gamed, and that requires a 

truly level playing field and rigorous competition. 

If some states require one or more health insurance issuers to offer continuous 

open enrollment as a matter of state law, under Section 1252, all insurance 

issuers in such states should be required to offer continuous open enrollment to 

achieve the uniform regulation intended by this section. This is a principle of 

PPACA and should be applied by HHS in a systematic manner. If it is not applied 

this way, PPACA runs the risk of not achieving what it has set out to do. 

 

I thank you for your consideration of this important aspect of PPACA and the preexisting coverage for children regulation. I hope you reconsider the open 

enrollment provision in the interim final regulation as you finalize it, and I trust 

your office will closely review all other guidance put forth to ensure it complies 

with the principles of truly equal regulation of insurance issuers. 

 

If you would like to discuss this matter further or need any additional information, 

please do not hesitate to contact me at 517-282-1695. 

Sincerely, 

Lynda Rossi, Vice President 

Social Mission, Public Affairs and Office of the President 

BCBSM is a nonprofit corporation and independent licensee of the Blue Cross and Blue Shield Association.