Health Care Reform – Fact Check

What Changes Under Health Care Reform?

As we wait for President Obama to sign the health care reform bill, it is time to look at the bill to see what will change for us now, and what will change in the future.

By the way, people over 50, but not old enough for Medicare, are the ones who can have a tough time when it comes to finding affordable private health insurance. We are older, so our premiums are higher no matter how healthy we are. And it is in middle age, when pesky health issues may start to arise that make it tough for us to find any good and cheap health insurance! So even though young adults may have a high percentage of uninsured people as a group, it is we older people who really have more challenges when we seek coverage!

Also, keep in mind – that even when the bill goes into law, it will only be the end of the beginning. The plan will be phased in over the next several years.

What Will Health Reform Change Right Away?

• The bill pumps $5 billion dollars into state high risk pools. People with pre-existing health conditions, and no coverage, will still have to pay premiums, but should pay less than they have to pay now. Many state insurance risk pools are very expensive! This is a double whammy to people who have health problems, and who have been declined for private coverage. This should help them.
• People with private coverage should have new safeguards that they cannot be thrown out of their plan if they get sick! This is already supposed to be safeguarded, but you can see many examples (i.e. Assurant and Jennifer Latham and the movie Rainmaker) of insurers trying to retroactively decline their own clients after they get sick.
• Grown children can stay on their parents health insurance, if they don’t have their own group health, until age 26.
• Children with pre-existing conditions must be accepted by private heath insurance.

Small Business and Self Employed Health Insurance

One great benefit I see out of this plan is a blooming of small business and self employment. Yes, we are free from the chains of worrying about jobs because of health care. Or at least, hopefully, we will be by 2014, when these chages will be put in place!

• Heath Insurance Exchanges – Self employed people, and small businesses, will be able to purchase medical plans in a health exchange, which is like a supermarket. The model is the current federal program which is what members of Congress use!
• Tax Credits That Work Like Discounts- Nearly 60% of people will get help paying for premiums.  People with lower to moderate incomes will get a tax credit. As they buy insurance, it will work like a discounnt. This should make premiums affordable for many more people.
• Medicaid Expansion – Medicaid will be open to more people who have very low incomes.
• Required Health Insurance – This is actually fair. Since people will be able to get policies, regardless of health, many would wait to buy until they got sick. This is NOT HOW INSURANCE WORKS! People will have to pay a fine if they don’t have coverage, and this will keep the risk pool large. Insurers need healthy and sick people in order to do business.

Group Insurance

If you already have a group medical plan, you probably won’t see big changes. But, if you lose your job, decide to switch jobs, etc., you do not have to worry about losing coverage. In my opinion, this can only be good.

Senior Citizen Health Insurance

Seniors are one group who are already covered by the national health system of Medicare. They are, of course, concerned abut their benefits. Right now, the federal government pays more for Medicare Advantage plans than they pay for traditional Medicare.

This may stop, and these plans may have to raise premiums. Right now, many do not even require an additional premium, over traditional Medicare, and some even rebate part of the Part B premium most seniors pay in their social security checks.

On the other hand, preventative care services will be raised, and eventually the gaps in the current Medicare prescription plan will be closed.

Doctors

Doctors, in some areas with fewer medical professionals, would actually get a ten percent payment boost for Medicare claims. In addition, Medicare will start by trying to develop a model that rewards doctors for keeping patients healthy, and not only for treating the sick.

Large Employer Groups

Employers still do not have to provide affordable group coverage for employees. But they will be encouraged to do so because they will get hit with stiff penalties if employees seek federal policies. While small business will be exempt, large employers will probably work hard to provide group plans that are at least as good and affordable as the federal plans, or they will accept the fines for failing to do so.

Many large companies only give a nod to health insurance by providing plans that are not really major medical policies to most employees. Again, they will either improve their offer, or they will accept the fines as their lower paid employes seek federal plans and tax credits to help them pay for it.

Health Insurance Companies

It is going to get a bit tougher to do business as a health insurance company. Premiums would have to be set so that a fixed percentage (80-85%) of the income would be spent on medical care. The rest would have to cover operating costs and profit. By 2014, private insurers will not be able to turn away people with health conditions, and they won’t be able to charge more for them.

To benefit the health insurance companies, they should have a larger group of people to insure os they can spread the risk. This is because health insurance will be mandatory for Americans, like car insurance already is for drivers. In addition, many health insurance companies already say theyoperate on a lower margin than the guidelines we outlined in the paragraph above.

Health Reform Update

Again, some changes will happen right away. Some will be phased in over the next few years to give all of the parties time to adjust and react. This is change that many progressives have been working on for 100 years. Let’s give change a channce.  If you have any comments, updates, or additions, please register and comment.

Related articles:

1. Obama Health Reform and Medicare: Fact vs Fiction
2. Health Care Reform 2009 Proposals and Debacles
3. Health Care Reform – A Short History: FDR to Obama
4. Who Will Health Reform Help Now?
5. Will Health Reform Hurt Medicare?

Tags: health care reform, Obama

This entry was posted on March 23, 2010 at 1:24 pm and is filed under Health Care. You can follow any responses to this entry through the RSS 2.0 feed.