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March 22nd, 2010

What's In the Health Insurance Reform Bill? [Mar. 22nd, 2010|11:31 am]
International Bon Vivant and Raconteur
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The House of Representatives passed the health insurance reform bill yesterday by a narrow margin of 219-212. It's not an entirely done deal yet--the President still needs to sign it into law, and a separate package of changes still needs to be voted on by the Senate--but it's a pretty safe bet at this point that it will be. But what's actually in the bill? Ask people and you're likely to hear different answers based on where those people stand politically, everything from universal health care, which it's not, to a death sentence for America's elderly, which it's also not. The Washington Post has a pretty good breakdown of what's actually in there. Here are the highlights:

The Good
+ Of the 40+ million uninsured in this country, 32 million more will now be insured as of 2014. That's 95% of eligible Americans, compared to the 83% who are insured today. With access to insurance often being the difference between life and death for someone facing a lethal or chronic disease, this will prevent more people from dying from treatable illnesses just because they can't afford insurance.

+ Starting this year, insurers will be forbidden from placing lifetime dollar limits on policies. With no more caps on insurance payouts, this means you won't drain your allotted amount on chemo, for instance, and then be left to die because the insurance company doesn't want to keep paying when you're only halfway through treatment. No one should have to file lawsuits against their insurance companies from their deathbed.

+ Also starting this year, insurers can no longer deny coverage to children because of pre-existing conditions, and parents will be able to keep their children on their own coverage up to age 26. With the job market the way it is, this will be especially helpful in keeping younger citizens covered while they're still scrambling to find work after graduation, or if they get laid off due to the economy.

+ Also starting this year, insurers can no longer cancel your policy because you get sick. This was the most egregious thing the insurance companies have been doing in their current unregulated state. They were more than happy to take your money when you were healthy, but get sick and they booted you off their coverage--though they kept your money, of course.

+ A new "high-risk pool" would offer coverage to uninsured people with medical problems until 2014, acting as a patch until the adult pre-existing condition reform kicks in. Once it does, insurers would be prohibited from denying coverage to people with medical problems or charging them more. Also, insurers would no longer be able to charge women more the way many are doing now, as if the possibility of pregnancy is a pre-existing condition.

+ The reform bill expands the Medicaid insurance program for the poor to cover people with incomes up to $29,327 a year for a family of four. Also, adults without children would be covered for the first time, starting in 2014. The federal government would pay 100% of costs for covering newly eligible individuals through 2016. Put more plainly, now you don't have to die from a treatable illness just because you're having money issues.

+ The reform bill also dramatically scales back a Senate-passed tax on high-cost insurance plans that was opposed by House Democrats and labor unions. I'm happy about this, as it was fundamentally unfair.

+ Starting this year, seniors who hit the "donut hole" coverage gap in the Medicare prescription drug benefit, which inexplicably cuts off coverage once seniors have spent $2,830 and then starts paying again after out-of-pocket expenses exceed $4,550, will receive a $250 rebate. Beginning next year, seniors in the gap will receive a 50% discount on brand name drugs. In other words, old people won't die because they don't have a lot of money.

+ Businesses are not required to offer coverage, but they will be hit with a fee of roughly $2,000 per employee if the government subsidizes their workers' coverage. Why do I think this is a good idea instead of an unfair one? Because it means businesses won't be able to do what Walmart used to--namely, tell their employees to file for Medicaid instead of covering them themselves. Businesses with 50 or fewer workers will be exempt from the requirement, which is smart. Hiring only part-time workers won't automatically exempt you, but two part-timers are counted as one full-time worker in the calculations, so you would need 100 part-time workers before you're hit with a fee for not offering them coverage.

+ Speaking of subsidies, aid will be available on a sliding scale for households making up to $88,200 for a family of four. Premiums for a family of four making $44,000 would be capped at around 6% of income. In other words, since health insurance premiums aren't guaranteed to go down so much as level off, financial assistance is available.

+ Starting in 2014, small businesses, the self-employed (hello, writers!) and the uninsured could pick a plan offered through new state-based purchasing pools called exchanges, which would offer the same kind of purchasing power that employees of big companies benefit from. This also means that if you lose your job, decide to freelance or become an entrepreneur, or want to change careers, you may be eligible for continued or subsidized coverage through an exchange. Put more simply, you're less likely to lose your health insurance because you lost your job.

+ Interestingly, though there's no "government option," citizens purchasing coverage through the new insurance exchanges would have the option of signing up for national plans overseen by the federal office that manages the health plans available to members of Congress. That's right, now you can have the same government-run health insurance enjoyed by those very lawmakers who tried to keep you from having it!

The Bad
+ Mandates. Starting in 2014, everyone is required to be insured or else pay a fine. Though there is an exemption for low-income citizens, I still think this is a bad idea. I get that it's intended to take a huge financial onus off the government's shoulders for emergency care, but it rubs me the wrong way.

+ Taxes. Starting in 2018, the thresholds at which new taxes would be imposed is $10,200 for individuals and $27,500 for families. To make up for the lost revenue, the reform bill applies an increased Medicare payroll tax to the investment income and to the wages of individuals making more than $200,000, or married couples above $250,000. The tax on investment income would be 3.8%. Now, I get that this has to be funded somehow, and taxes are how things get funded. It would be fairer, and cheaper for everyone, if we all chipped in the exact same amount. But that's called the single-payer system, and for whatever reason we're not allowed to have that yet.

+ It's going to take until 2020 to completely eliminate the "donut hole" coverage gap in the Medicare prescription drug benefit. And even when it's closed, seniors will still have to pay for 25% of the cost of their medications until Medicare's catastrophic coverage kicks in. That's not always easy to do when you've run out of money and are living in a retirement home on your children's dime.

+ If a subsidized health insurance plan covers abortion, policyholders would have to pay for abortion coverage separately, with that money being kept in a separate account from taxpayer money. You read that right, you would now have to budget and plan for one day maybe having the possibility of an abortion. Look, I get that abortion is a controversial topic, but to call this unworkable is an understatement. Also, states could ban abortion coverage in plans offered through the exchange, but at least exceptions would be made for cases of rape, incest and danger to the life of the mother.

+ Two ideas floated by Republicans during the recent bipartisan summit--investigating medical fraud and reforming medical malpractice insurance--have a lot of validity to them but weren't incorporated. (I'm not usually a proponent of tort reform, but it's no secret that malpractice insurance costs are driving up medical costs and driving doctors from the industry.) Still, on the plus side, one good Republican idea was incorporated--namely, an increase in payments to primary care physicians under Medicaid.

The Ugly
+ Though a special deal that would have given Nebraska 100% federal financing for newly eligible Medicaid recipients in perpetuity has been eliminated, a different, one-time deal negotiated by Senator Mary Landrieu for Louisiana, worth as much as $300 million, remains in the bill. I'm not saying Louisiana doesn't have financial needs, especially as the rebuilding after Hurricane Katrina continues, but holding the reform bill hostage to get more federal financing for your state is just ugly.

So, do I think the health insurance reform bill is a good thing? As someone who has been uninsured in the past because I couldn't afford the upwards of $800 a month that insurance companies wanted me to pay as an individual, and as someone whose current insurance has decided not to pay my primary care physician for my recent annual check up while they "investigate whether this is related to a pre-existing condition," yes. Yes, I do think it's a good thing. It's also something that should have been done years ago.

To tell you the truth, I would have liked to see it go farther toward the single-payer insurance that my friends in Canada swear by, and I would have liked to see more of it come into action before 2014, but we've always been a country more comfortable with baby steps than giant leaps. It's not a perfect bill, but it's not going to change American freedom as we know it either, or turn us into a socialist state, or transform the government into totalitarian Nazis, or create death panels, or do any of the things that opponents thought it would. It does what it basically set out to do, which is to keep Americans from suffering or dying unnecessarily because of their financial situations. Frankly, that it took this long to do, and caused this much rabid division, is kind of shameful.

But at least now we're one step closer to being a civilized, twenty-first century nation.
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How Does It Affect Me? [Mar. 22nd, 2010|03:57 pm]
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The most important question everyone is asking themselves after the passage of the health insurance reform bill is, "How will it affect me?"

Well, the Washington Post has put together a very easy-to-use tool to figure out exactly that. Just answer four simple questions, and it will tell you exactly how the insurance reform will affect you and your family, specifically in terms of taxes and tax credits. It's a very helpful way to understand the reform in personal, real-world terms.
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