Tuesday, March 23, 2010

Health Reform Makes History - What Does it Mean?

The House voted late Sunday March 21, 2010 (219-212 vote) in favor of sending the Health Reform Bill to President Obama. In addition, the House Democrats made some changes to the Senate's health reform bill (220-211 vote) which now goes back to the Senate. They must pass word-for-word reconciliation. As I post this blog entry, Obama is signing this long-awaited bill for the health of our nation.

32 million uninsured will now have health insurance. Excluded in this number are: illegal immigrants (who are also banned from purchasing in the health insurance exchanges), those eligible for Medicaid who won't enroll until they seek care, and those choosing to pay the fine instead of purchasing health insurance.

Here is a breakdown of (some of) what is included in this historical piece of health legislation.

Effective Immediately up to 6 Months From Now:
1) Insurers can't deny coverage to sick children (due to preexisting health conditions)
2) Free preventive care--screenings and preventive care must be excluded from annual deductibles on any new plans (all other plans affected in 2018)
3) No caps on lifetime benefits and restrictions on annual limits on coverage
4) Young adults allowed to stay on parent's insurance until the age 0f 26
5) Medicare Advantage (Medicare benefits delivered by private firms) gets cuts in spending in 2011
6) Children on Medicaid or state CHIP can't be dropped from now until 2019
7) Excise tax on tanning beds (10%)--"sin" tax
8) Individuals without coverage because of preexisting conditions can purchase it from high-risk pools (to be combined into exchanges in 2014)
9) Rebate of $250 for Medicare seniors in the "donut hole" for prescription drug benefits. First of incremental steps to close the hole (half-closed next year)

Effective in (or just prior to) 2014:
1) Individual Mandate--Everyone must purchase health insurance or pay annual fine of $95 (rises to $695 in 2016) unless they can prove financial hardship.
2) State health insurance exchanges--marketplace of insurance plans--goes into effect
3) Insurers can't deny coverage to adults with preexisting health conditions
4) Insurers required to cover maternity care same as medical procedures
5) Tax credits will start helping pay premiums for working families with incomes up to $88,000 per year
6) Medicaid expanded to cover more low-income people, up to 133% of federal poverty level
7) Medicare payroll tax increase of 1% for individuals making >$200k and couples making >$250k
8) New Medicare tax on unearned income of 3.8% (in 2013)
9) "Donut Hole" closing--Medicare Part D prescription drug coverage gap to be fully closed by 2020

Other items:
In 2018, "Cadillac health plans" are taxed 40% of value of the plan above thresholds (of $10,200 per individual or $27,500 per family)
The bill maintains longstanding federal funding restrictions (known as Hyde Amendment) on abortions. The exception would be in cases of rape or incest, or when the life of the woman would be endangered.

It is estimated by the nonpartisan Congressional Budget Office to cut federal deficits by $143 billion over the next decade. This bill is a landmark piece of legislation to improve the health of our nation's people. In my eyes, this is an incremental step (and focused on health insurance reform), but an amazing step nonetheless.

What are your thoughts about this this historical event, the passing of health reform?


Bryce Holt said...

This was eye-opening. I've heard more about the infighting than what was actually coming out of this signing! Thank you for giving a focused brief on what a few of the major changes coming entail, Stacy!

I'm so pleased that this was finally, mercifully passed. There's so much need out there, and (equally) there's so much the insurance companies try to do to screw the hard working American who actually pays their paycheck. I'm overly biased, but I hope insurance companies have seen the last day of taking advantage of the very people they are supposed to help.

Great post, very informative and much appreciated.

GoGoAmanda said...


Thank you for summarizing the bill. I hope it's helpful to those who are not in public health. I've received several questions from friends, and I'm pointing them to this blog. I appreciate your work so very much!

If anyone is interested, here's what America's family physicians think of the health reform bill: http://www.aafp.org/online/en/home/media/releases/2010b/patient-protection-and-affordable-care-act.html

In short, they favor it!

E-murf said...

Wow, your summary is even more concise than Kaiser Family Foundation's - well done :) I think this bill was the best of the 3 options. I like the excise tax on fancy medical technology, and the accountable care organizations pilot. Those will hopefully go a long way toward reducing costs. I also think it's a good idea to force everyone into the market to get healthier people into plans to help cover those w/ preexisting conditions.