UnitedHealth Group and other health insurers would be able to vary their premiums based only on age, tobacco use, family size or geography under proposed U.S. rules meant to protect people with pre-existing illnesses.

In addition, the Department of Health and Human Services outlined various conditions and services insurers must cover, and laid out rules to let companies expand employee wellness programs, according to proposed regulations posted online Tuesday. The proposals mark the Obama administration’s move to begin formalizing core provisions of the Affordable Care Act.

The first rule targets 50 million to 129 million Americans who have conditions that insurers have cited to deny coverage or increase premiums, such as diabetes and cancer, the department said in its filing. Beginning in 2014, insurers can no longer consider those illnesses in coverage decisions.

“Thanks to the health care law, no one will be discriminated against because of a pre-existing condition,” Health and Human Services Secretary Kathleen Sebelius said in a statement.

Insurers will be able vary premiums based on age, and are limited to charging their oldest customers three times as much as their youngest ones. The regulation must go through a public comment period and may change before taking effect.

Wellness programs

The second rule requires insurers to cover a broad set of conditions and services, such as emergency room treatments, hospitalization, drugs and pediatric care. The government allowed states to pick benchmark plans for benefit packages matching those requirements, and today published a list of those plans. Most are plans offered by state Blue Cross and Blue Shield companies.

Under the government’s wellness proposal, employers can award workers as much as 30% of the cost of their health coverage if they participate in programs such as joining a gym or attending health seminars. The limit now is 20%, according to a news release.

Workers could earn as much as 50 percent of the cost of their coverage if they participate in tobacco cessation programs, according to the proposed rule.

To contact the reporter on this story: Alex Wayne in Washington at awayne3@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net


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