Focus on Health Care Reform: What’s New in 2011

As we launch into a new year, the federal government also begins the next stage of Affordable Care Act (ACA) implementation. Below you’ll find a brief update of the provisions set to begin implementation this calendar year. All provisions are effective as of January 1, 2011 unless otherwise noted.


  • Insurers required to pay rebates if target medical loss ratio is exceeded.
  • Health and Human Services to begin awarding grants to states for the establishment of American Health Benefit Exchanges and Small Business Health Options Program Exchanges. Effective March 23, 2011.
  • CLASS (Community Living Assistance Services and Support Act) Program is established as a voluntary program for purchasing long-term care insurance.
  • Over-the-counter drugs not prescribed by a doctor are excluded from Health Reimbursement Accounts and Flexible Spending Accounts.
  • 20% tax on pre-tax distributions from HRAs or FSAs that are not used for qualified medical expenses.


  • States will now have the option to permit certain Medicaid enrollees to designate a provider as their health home. States will receive 90% FMAP for 2 years for these services. 
  • Health and Human Services can begin providing 3 year grants to states to develop chronic disease prevention programs under Medicaid.
  • Prohibition on federal payments to states for Medicaid services related to certain hospital-acquired infections.
  • State balancing incentive program created to provide enhanced FMAP payments for non-institutionally based long-term care services.


  • 10% bonus payments for primary care services and general surgeons in health professional shortage areas begin.
  • Funding for the Independent Payment Advisory Board becomes available October 1, 2011.
  • Waived deductible for colorectal cancer screenings and the elimination of cost-sharing for covered preventative services.
  • Pharmaceutical manufacturers must begin providing a 50% discount on brand-name drugs filled in the Part D coverage gap.
  • Part D premium subsidies for high-income beneficiaries reduced.
  • Medicare Advantage payments restructured by phasing-in lower fee-for-service rates.  Prohibits plans from imposing higher cost-sharing requirements on some benefits.


  • Chain restaurants and vending machines required to disclose nutritional content of standard menu items beginning March 23, 2011.
  • Unused GME residency slots will be redistributed beginning July 1, 2011.

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