Congress Will Probe Special Exemptions to Health-Care Law That Obama Administration Gave Select Unions and Businesses, Says Republican Senator

January 27, 2011 - 6:30 AM

Washington (CNSNews.com) – The Obama administration’s waivers to temporarily exempt certain companies, unions, and charities from rules established by the new health care law are a “perfect example of special interests” having influence in the administration and will be looked into  by Congress, Sen. Charles Grassley, the ranking member of the Senate Finance Committee told CNSNews.com.

"You’re going to find out that by the president doing that with the secretary of HHS, he violated one of his main principles when he ran for office--and that was that special interests were not going to have an in in his administration,” said Grassley. “And this is a perfect example of special interests having an in in his administration when they get those waivers.”

Grassley, who has a history of leading Senate investigations into government waste, fraud, and abuse, said oversight of the special waivers will be taken up by the Republican-controlled House.

“There will be [congressional oversight] and it will be done in the House of Representatives,” Grassley told CNSNews.com. “I’ll be glad to help the House of Representatives. We probably won't get chairmen of the committees of the Senate to have that oversight, but if it's done in the House of Representatives, the job will be done and it will be done right.”

The Finance Committee where Grassley serves as the top Republican was the Senate committee primarily responsible for drafting the Obama health-care law.

The waivers allow the health insurance plans, carried by the unions and companies involved, to impose annual limits on what they will spend on a policy holder’s medical coverage for a given year. The Patient Protection and Affordable Care Act, dubbed Obamacare, bans annual limits, phasing them out by 2014.

CNSNews.com previously reported that the Department of Health and Human Services (HHS) issued waivers to 222 entities – companies, unions and charitable organizations. Among those entities, 45 were labor union organizations. A total of 1,507,418 enrollees were affected by the waivers. More than one-third of the enrollees affected, 512, 315 people, were insured under union health care plans.

Three locals of the powerful Service Employees International Union (SEIU), which has spent heavily on elections in favor of Democrats, were among the biggest beneficiaries of waivers, CNSNews.com reported.

The largest beneficiary of waivers is the United Federation of Teachers (UFT), representing New York City public school teachers, with a plan that affects 351,000 enrollees. The UFT is a member organization of the American Federation of Teachers, a major contributor to Democrats. In addition, 10 locals of the United Food and Commercial Workers – also a major Democratic contributor – received HHS waivers.

The new health care law bans annual limits on medical coverage beginning in 2014. These limits are caps that an insurance plan can place on how much it will spend on a policy holder’s medical coverage each year. The HHS regulations are phasing the limits out, as annual limits can be no less than $750,000 for 2011, no less than $1.25 million in 2012 and no less than $2 million in 2013.

Sen. Chuck Grassley

Sen. Charles Grassley (R-Iowa). (AP Photo/Susan Walsh)

In September, HHS announced it would grant waivers to employers to prevent some workers from losing their benefits, if the insurer could not meet the new health care law’s requirements on annual limits. The waivers are granted by HHS if the department determines “compliance in the interim final regulations would result in a significant decrease in access to benefits or a significant increase in premiums,” according to a Sept. 3 memo by Steve L. Larson, director of the HHS Office of Consumer Information and Insurance Oversight.

In giving the Tea Party response to President Barack Obama’s State of the Union speech on Tuesday, Rep. Michelle Bachmann (R-Minn.) also criticized the waivers.

“Obamacare mandates and penalties may even force many job-creators to just stop offering health insurance altogether, unless, of course, yours is one of the more than 222 privileged companies, or unions, that's already received a government waiver under Obamacare,” Bachmann said. “In the end, unless we fully repeal Obamacare, a nation that currently enjoys the world’s finest health care might be forced to rely on government-run coverage. That could have a devastating impact on our national debt for even generations to come.”