Regulatory Scoring
Agency:
HHS, DOL, Treasury
Rule title:
Dependent Coverage for Children up to Age 26
RIN
0991-AB66 RIA No
Stage Publication Date
Interim Final Rule 5/13/2010
Rule summary:
This document contains interim final regulations implementing the requirements for group health plans and
health insurance issuers in the group and individual markets under provisions of the Patient Protection and
Affordable Care Act regarding dependent coverage of children who have not attained age 26.
Openness Score Comments
1. How easily were the RIA, the proposed rule, and any supplementary
materials found online? 5 1A
2. How verifiable are the data used in the analysis? 2 1B
3. How verifiable are the models and assumptions used in the analysis? 2 1C
4. Was the Regulatory Impact Analysis comprehensible to an informed
layperson? 2 1D
Total Openness (Sum of 1-4) 11
Analysis Score Comments
5. How well does the analysis identify the desired outcomes and demonstrate
that the regulation will achieve them? 2 2A
6. How well does the analysis identify and demonstrate the existence of a
market failure or other systemic problem the regulation is supposed to solve? 1 2B
7. How well does the analysis assess the effectiveness of alternative
approaches? 1 2C
8. How well does the analysis assess costs and benefits? 2 2D
Total Analysis (Sum of 5-8) 6
Use Score Comments
9. Does the proposed rule or the RIA present evidence that the agency used
the Regulatory Impact Analysis? 1 3A
10. Did the agency maximize net benefits or explain why it chose another
alternative? 0 3B
11. Does the proposed rule establish measures and goals that can be used
to track the regulation’s results in the future? 0 3C
12. Did the agency indicate what data it will use to assess the regulation’s
performance in the future and establish provisions for doing so? 1 3D
Total Use (Sum of 9-12) 2
Total Score 19
Openness
Criterion Score Com. No. Comment
The Federal Register notice appears
readily in regulations.gov using a RIN
1. How easily were the RIA, or keyword search. The RIA is in the
notice. A keyword search on HHS.gov
the proposed rule, and any turns up a link to a "regulations and
supplementary materials guidance" page that has a link to the
found online? 5 1 regulation.
Data from Kaiser Family Foundation
are sourced and linked, but internal
government data are not sourced very
transparently: "The Departments’
estimates in this section are based on
the 2004–2006 Medical Expenditure
Panel Survey Household Component
(MEPS–HC) which was projected and
calibrated to 2010 to be consistent
with the National Health Accounts
projections." Data sources for
2. How verifiable are the data paperwork cost estimate are given
used in the analysis? 2 2 and usually linked.
Calculations of the number of people
affected are clear. Calculations of
increased premium costs are not
transparent enough for the reader to
verify. No justification presented for
3. How verifiable are the assumed take-up rates; they do not
models and assumptions appear based on studies of take-up
used in the analysis? 2 3 rates reported in the RIA.
RIA is reasonably readable. The
change in insurance costs was
apparently calculated from data, but
4. Was the analysis the analysis does not show the
comprehensible to an calculations so these results are pretty
informed layperson? 2 4 opaque.
Analysis
Score Com. No. Comment
5. How well does the
analysis identify the desired
outcomes and demonstrate
that the regulation will
achieve them? 2
Does the analysis clearly
Improved health outcomes, greater job mobility,
identify ultimate outcomes reduced cost-shifting attributable to
that affect citizens’ quality of uncompensated care. Two of the three are final
life? 4 5A outcomes; job mobility is a means to an end.
Does the analysis identify Additional number of individuals who receive
how these outcomes are to coverage is estimated. Ultimate effects on health
be measured? 1 5B outcomes or other benefits are not calculated.
Making individuals younger than 26 eligible for their
parents' insurance will reduce the number of
uninsured. Having more people covered by
insurance will produce the benefits described
Does the analysis provide a above. (It is not clear that this regulation will really
reduce cost-shifting; it appears to be just another
coherent and testable theory
form of cost-shifting.) It is unclear how the rule will
showing how the regulation generate most of the claimed outputs let alone
will produce the desired whether these outputs will lead to the eventual
outcomes? 1 5C outcome of a healthier population.
Cited research on take-up rates suggests that
some new people will receive coverage as a result
of the regulation. The analysis mentions but does
not cite studies of similar state laws, then asserts
that these studies may not be a good guide to the
quantitative impact. No research cited
Does the analysis present demonstrates that increased insurance coverage
credible empirical support for improves health outcomes, increases job mobility,
the theory? 2 5D or reduces cost-shifting.
Low, mid-range, and high estimates of the number
of new insured are based on different assumptions
about take-up rates, which are acknowledged to be
uncertain. It is not clear from where the
assumptions about take-up rates came. The low
range does not appear to be as low as the studies
Does the analysis
of state programs might indicate, so it is not clear
adequately assess the analysis captured the full range of
uncertainty about the uncertainties. No uncertainty analysis of ultimate
outcomes? 1 5E outcomes.
6. How well does the
analysis identify and
demonstrate the existence of
a market failure or other
systemic problem the
regulation is supposed to
solve? 1
Sole justification given under "Need for Regulatory
Action" is that the regulation is necessary to
implement the law. It would expand insurance
coverage for individuals aged 19-25, but nowhere
does the analysis explain whether these individuals
lack coverage due to some type of systemic
Does the analysis identify a problem. The departments say that too few people
market failure or other are insured but not why the number of people is
systemic problem? 1 6A above or below the optimal amount.
Does the analysis outline a
coherent and testable theory
that explains why the
problem (associated with the
outcome above) is systemic
rather than anecdotal? 0 6B No theory of a systemic problem offered.
Data show how many young people are uninsured,
but no empirical analysis demonstrates why this is
Does the analysis present not merely their choice. No evidence presented
credible empirical support for showing that the uninsured individuals lack
the theory? 1 6C insurance due to some kind of systemic problem.
Does the analysis
adequately assess
uncertainty about the The problem itself is not well-defined in the
existence or size of the analysis, and there is no assessment of uncertainty
problem? 0 6D about the problem.
7. How well does the
analysis assess the
effectiveness of alternative
approaches? 1
Does the analysis enumerate The departments considered whether to define
other alternatives to address who is considered a child, but opted to allow plans
the problem? 2 7A to make this decision themselves.
Is the range of alternatives
considered narrow (e.g.,
some exemptions to a
regulation) or broad (e.g.,
performance-based
regulation vs. command and
control, market mechanisms,
nonbinding guidance,
information disclosure,
addressing any government
failures that caused the This is a tweak, not a fundamentally different
original problem)? 1 7B regulatory alternative.
Does the analysis evaluate
how alternative approaches No relevant content. The alternative is dismissed
would affect the amount of with a couple sentences that do not seem related
the outcome achieved? 0 7C to the topics in the regulatory analysis.
Does the analysis
adequately address the
baseline? That is, what the
state of the world is likely to
Baseline number of uninsured is assumed to be
be in the absence of federal the number in the most recent year for which data
intervention not just now but are available. No discussion of how this number
in the future? 1 7D might change in the absence of this regulation.
8. How well does the
analysis assess costs and
benefits? 2
Analysis calculates cost of notifying people about
eligibility. The increase in premiums needed to pay
for the increase in coverage is calculated but
Does the analysis identify
characterized as a transfer from families without
and quantify incremental dependents aged 19-25 to families with
costs of all alternatives dependents aged 19-25. No cost calculation for the
considered? 2 8A sole alternative mentioned.
The analysis likely captures the major expenditure,
which is the cost of covering people who are
Does the analysis identify all currently not covered. Hard to judge how well this is
expenditures likely to arise done because the per participant costs are simply
as a result of the regulation? 2 8B stated, not calculated or sourced.
Total change in premium costs is calculated.
Does the analysis identify
Analysis notes that this will likely result in transfers
how the regulation would between families covered by group policies, but
likely affect the prices of buyers of individual policies will likely cover the full
goods and services? 3 8C costs themselves.
Alternative take-up rates are simply assumed for
Does the analysis examine the purpose of calculating a range of possible
costs, but no other effects on behavior are
costs that stem from
analyzed. For example, there is no estimate of the
changes in human behavior number of people who might drop their coverage
as consumers and producers due to the increased premiums or changes in the
respond to the regulation? 2 8D amount of insurance coverage offered.
If costs are uncertain, does
the analysis present a range Alternative take-up rates have different implications
of estimates and/or perform for premium costs; analysis provides a range of
a sensitivity analysis? 3 8E estimates.
Does the analysis identify
the alternative that Since benefits were not estimated, net benefits
maximizes net benefits? 0 8F could not be calculated.
Since ultimate outcomes were not estimated, cost-
effectiveness could not be calculated. The analysis
Does the analysis identify does report costs per new insured person, which
the cost-effectiveness of could be viewed as a cost-effectiveness calculation
each alternative considered? 2 8G for an intermediate outcome.
Principal parties who bear costs would be insurers,
insured people who do not have eligible children (in
Does the analysis identify all
group plans) and insured people who do have
parties who would bear costs eligible children (in individual plans). Analysis notes
and assess the incidence of that costs/transfers would be distributed among
costs? 2 8H these groups but does not calculate how.
Principal beneficiaries are new recipients of
Does the analysis identify all
insurance. In a few cases, the analysis asserts that
parties who would receive people who lack insurance but have high medical
benefits and assess the costs would be the most likely to benefit. No further
incidence of benefits? 1 8I discussion of incidence of benefits.
Use
Criterion Score Com. No. Comment
The notice makes no claim to use the analysis,
and it appears the major decisions were
determined by the law. The one alternative tweak
was dismissed with reasoning unrelated to the
regulatory analysis. Notice states that these are
9. Does the proposed rule or
interim final rules because there would be
the RIA present evidence insufficient time to conduct a notice-and-
that the agency used the comment rulemaking to meet the Sept. 23, 2010
analysis? 1 9 deadline.
The analysis did not calculate net benefits, so the
departments made their decisions with no
cognizance of net benefits. The notice asserts
10. Did the agency maximize that the benefits will outweigh the costs, but the
net benefits or explain why it analysis does not even really marshal the
chose another alternative? 0 10 qualitative evidence to make this point.
No measures and goals established. The
11. Does the proposed rule projections of increases in the number of insured
individuals could be used to establish at least
establish measures and
intermediate outcome goals, but it is not clear
goals that can be used to from the RIA whether the low, medium, or high
track the regulation's results scenario would be the most likely/appropriate
in the future? 0 11 goal.
12. Did the agency indicate
what data it will use to
assess the regulation's
Data on insurance coverage for the target groups
performance in the future could be used to measure intermediate
and establish provisions for outcomes. It would take a lot of work to get from
doing so? 1 12 the RIA to reasonable quantitative goals.
Rule Title RIN Openness
Agency Pub Date RIA separate? Total (G+H+J) Analysis
0991-AB66 Treasury to Age 26
HHS, DOL,
Dependent Coverage for Children up5/13/2010 No 19 11 6
Quality (G+H) Use 1 2 3 45 5A 5B
17 2 5 2 2 2 2 4 1
5C 5D 5E 6 6A 6B 6C 6D 7
1 2 1 1 1 0 1 0 1
7A 7B 7C 7D 8 8A 8B 8C 8D
2 1 0 1 2 2 2 3 2
8E 8F 8G 8H 8I 9 10 11 12
3 0 2 2 1 1 0 0 1