New insurance fee to pay for medical treatment studies

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Health InsuranceBeginning in 2012, there will be a new federal fee applied to health insurance policies which will be applied to research studies that will help to determine which types of treatments, tests, procedures, and drugs are the most effective.

The purpose of these medical studies is to identify whether new tests and treatments truly are as effective as their less expensive generic counterparts. This is a portion of the Obama administration’s health care law that has not received as much hype as other elements such as the state insurance exchanges.

The primary issue surrounding this fee, though, is the politics in the health care industry. Studies of the effectiveness of medical tests and techniques are typically viewed with suspicion, and insurance fees that are meant to fund this type of effort could be labeled as a form of hidden tax, which could be a serious issue during the politics of the upcoming election year.

The agency that will be responsible for conducting the research will be the Patient-Centered Outcomes Research Institute, which is an quasi-governmental organization that was established by Congress for this purpose. So far, it has not yet performed any direct comparisons, but its director is keen to get started.

The institute has already received some funding from the federal government, but additional money will come from the $1 per person insurance fee that begins next year. That said, the Treasury Department has stated that it is unlikely that the institute will actually see that money for at least a full year, though the insurance companies will still owe that fee – it will not belong to them.

In 2013, the per-person fee will be raised to $2, and will increase at the rate of inflation after that point. It is likely that the IRS will be providing insurance companies with guidance regarding these fees in the first half of next year.

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