Friday, March 19, 2010

The Health Care Bill: Ten Things You Need To Know by

1) For people with preexisting health conditions: Insurance
companies would no longer be allowed to deny coverage to people
based on their past medical history; everyone would be entitled to
insurance, and insurers couldn't charge vastly higher prices for
people with preexisting conditions. Right now, states allow insurers
to deny coverage to people with any number of conditions -- from
acne to cancer -- and some let insurers deny coverage to victims of
domestic violence.
The provision wouldn't take effect until 2014, though within six
months of the bill becoming law, insurers would be barred from
denying coverage to children with preexisting conditions. People with
preexisting conditions who are uninsured now would have access to a
temporary national "high-risk pool" insurance plan as a backup until
then. That coverage wouldn't be as comprehensive, though.
2) For people who buy their own insurance or for small
businesses: Instead of leaving small businesses and individuals to
negotiate on their own with insurance companies, the bill would set
up exchanges where insurers offer plans. Each state would set up its
own exchange, but the idea is to provide a regulated marketplace to
select a plan. You could look through the different available plans,
compare them on one Web site and enroll directly through the
People who couldn't afford the insurance offered on the exchange
would get subsidies to help them. Subsidies would be available for
families of four making up to $88,000 a year -- or 400 percent of the
federal poverty level. Medicaid would be available for families with
incomes up to 133 percent of the poverty level. Out-of-pocket
expenses would be capped at $11,900 per year per family, or $5,900
per year for individuals. That's still a lot of money, but Democrats say
it's less than many are spending now. You would be required to buy
insurance, either on the exchange or through your job, or pay a fine to
the IRS. Small businesses would be eligible for tax credits for up to 35
percent of the cost of healthcare premiums if they offer insurance for
Abortions could not be covered by plans that get subsidies; if women
who use the exchanges wanted to make sure their insurer would cover
abortions, they'd have to pay separately for an additional policy.
The net effect would be to dramatically reduce the number of people
who don't have insurance. Twenty-four million people would get
coverage through the exchanges, according to the Congressional
Budget Office; another 16 million would enroll in Medicaid. Thirtytwo
million people, total, would get insurance who don't have it now.
The exchanges, like the ban on preexisting condition denials, would
be set up in 2014. Ninety-two percent of the population that isn't old
enough to get Medicare would have insurance -- up from 81 percent
3) For people who get insurance through their jobs:
Employers with more than 50 workers would be required to offer
insurance. Businesses that don't offer coverage would have to pay
$2,000 per employee if any of their employees got federal subsidies
to buy their own coverage.
Little else would change for people who have insurance through work,
which is how the vast majority of Americans get their coverage.
Premiums could fall by as much as 3 percent over what they would be
if the bill doesn't pass (but they'll still be higher than they are now,
because healthcare costs keep rising). There would be a new tax on
the most generous plans -- those with a value of more than $27,500
for families. That value would be indexed to inflation, so as prices go
up in general, the limit for the tax would rise with them. The goal of
the tax is to keep employers from offering so-called Cadillac plans,
because experts believe they encourage patients and doctors to spend
money unnecessarily on care that might not actually improve health.
4) Other reforms to the insurance market: Most plans would
be required to cover preventive care with no co-payments, so you
could get something like an annual physical for free. Children would
be allowed to stay on their parents' insurance until they turn 26.
Insurers would have to spend 80 to 85 percent of what people pay in
premiums on actual medical services; right now, they're allowed to
spend less, pocketing the difference. Insurance companies would no
longer be able to drop people from coverage once they get sick, a
practice known as "recision." Lifetime limits on the amount of
medical care your insurer would pay for would be illegal, and annual
limits would be "tightly restricted."
5) For seniors: The Medicare prescription drug "donut hole," which
left seniors on the hook for significant drug bills, would be closed
completely by 2020. Seniors who spend enough to fall into the gap in
coverage now would get $250 rebates. Medicare taxes would be
charged on dividends, capital gains and other unearned income for
people making more than $250,000 a year, which would help keep
the program solvent.
Payments to private insurance companies that run Medicare
Advantage plans would be frozen in 2011, which Democrats say would
eliminate overpayments. (Republicans argue that's basically a cut
from Medicare.)
6) How much does it cost? The price for all that isn't cheap --
$943 billion over 10 years, mostly because of the subsidies to help
people buy insurance. The country spends nearly $2.5 trillion each
year on healthcare now, though.
The bill is mostly paid for, in part by new fees on pharmaceutical
companies, manufacturers of medical devices and other industries
that will benefit from the expansion of access to healthcare it would
allow. Those companies will all make more money, the theory goes,
because they'll have millions of new customers who don't have
insurance now. Other fees, including payments from people who
don't buy insurance despite the mandate, penalties on companies that
don't provide insurance, and a higher payroll tax to cover Medicaid
and Medicare for people who make more than $250,000, would help
make up the rest of the tab.
7) What about the deficit? The Congressional Budget Office says
the bill would lower the deficit by $138 billion over the next 10 years.
The decade after that, the bill would cut the deficit by $1.2 trillion.
Projections that far out are hard to put much stock in, though.
Most of those savings would come because the government would be
spending less on Medicare and Medicaid.
8) How will medicine change? The bill includes incentives to use
more electronic medical records, which should make healthcare more
efficient and effective. It would set up pilot programs for medical
malpractice tort reform. Community health clinics, which help serve
people who often don't have access to other forms of care, would get
more funding. Medicare payments would be linked to quality of care,
which should shift more providers toward evidence-based standards
to see how well treatments work.
Other pilot programs would be set up to study how to improve public
health in general, and improve care for people with chronic diseases,
rural patients and other groups. The goal is to improve the quality of
care while holding the costs down.
9) What doesn't it do? Even if the bill passes, the fundamental
structure of the U.S. medical system will remain more or less the
same -- you'll pay a private insurance company, they'll reimburse
your doctors for care. There's no public health insurance option,
which many progressives wanted; there's nothing remotely like a
single-payer healthcare system, which progressives had hoped for at
the outset.
That's by design. The White House decided early on to try to work
with the big industries involved in healthcare and get them to join the
effort, rather than trying to fight against them. Believe it or not, that's
made it easier to pass the bill (the opposition would be far greater if
most industry groups weren't still on board). But it also limited its
ambition -- the goal was to tinker with the way the system worked,
not scrap it and replace it with something else.
10) How did it get to this point? Congress debated the bill for
more than a year. It went through three House committees and two
Senate committees, including one --Finance -- where Democrats
spent months trying to get a bipartisan proposal put together. A lot of
Republican ideas made their way into the legislation, even though no
Republicans are likely to vote for it.
The House passed its version of the bill on Nov. 7, and the Senate
passed its own on Dec. 23. But after Scott Brown won a
Massachusetts Senate special election in January, Republicans had
enough votes to filibuster any additional healthcare action. So the
only way forward was for the House to pass the Senate bill unchanged
-- sending it to President Obama to sign -- and then for both
chambers to pass a package of changes using the budget
reconciliation process.

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