Health care reform
Content
EFFECTIVE NOW
LOW INCOME, THOSE WITH PRE-EXISTING ILLNESSES, AND THE DISABLED States can cover more people through Medicaid
States can choose to receive federal matching funds to childless adults with incomes up to 133 percent of the federal poverty level, a higher threshold than before. Who benefits: Low-income childless adults percent of the employer’s contribution to employees’ health insurance; this ceiling will increase to 50 percent in 2014. Also, small non-profit organizations now may receive up to a 25 percent credit, increasing to 35 percent in 2014. Who benefits: Small businesses with fewer than 25 employees Who pays more: Federal government
HEALTH CARE
The Democrats’ overhaul of the nation’s health care system will unfold over the next 10 years. Here are the changes taking place now and in the next few years.
NEXT YEAR
THE DISABLED Home care for the disabled
The new Community First Choice Option allows state Medicaid programs to offer home- and community-based services to disabled individuals rather than nursing-home care. When: Effective Oct. 1, 2011 Who benefits: Disabled individuals Who pays more: Federal government and states beneficiaries
REFORM
Reducing payments to Medicare Advantage insurers
The law gradually eliminates the extra amount that Medicare pays per person to private insurers’ Medicare Advantage plans compared with outlays under traditional Medicare. The law also prohibits Medicare Advantage plans from imposing higher cost-sharing requirements than traditional Medicare for some covered services. When: Effective Jan. 1, 2011 Who benefits: The Medicare budget Who pays more: In effect, health insurers because they’ll receive less
Coverage for uninsured people with pre-existing conditions
A new temporary program provides coverage for people with pre-existing medical conditions who have been uninsured for at least six months. States may set up their own programs; if they don’t, residents can apply for coverage through a national plan. When: National program is in effect now Who benefits: Uninsured people with pre-existing conditions
SENIORS Expand coverage for early retirees
A $5 billion reinsurance program helps employmentbased plans extend coverage to people who retire between the ages of 55 and 65, as well as their spouses and dependents. Who benefits: Early retirees
Thinkstock photos
SENIORS Prescription drug discounts
Drug manufacturers must provide a 50% discount on brand-name prescriptions for seniors with Medicare drug plans who reach the “doughnut hole” coverage gap. Also, federal subsidies begin for generic prescriptions filled during that coverage gap. When: Effective Jan. 1, 2011. Over the next 10 years, discounts will increase until the coverage gap is closed in 2020. Who benefits: Medicare drug-plan members who reach the “doughnut hole” Who pays more: Drug manufacturers, federal government
Cuttings costs to preserve Medicare
The Independent Payment Advisory Board will propose ways to reduce the growth in Medicare spending and extend the life of the Medicare Trust Fund. When: Funding available Oct. 1, 2011 Who benefits: Medicare recipients
“Doughnut hole” $250 rebate
Seniors who reach the “Doughnut Hole” in Medicare prescription coverage this year — after their drug costs for the year reaches $2,840 — receive a $250 rebate. Who benefits: Seniors in the Medicare prescription gap Who pays: Federal government
Right to appeals claims denials
Consumers have the right to appeal coverage claims denials to their insurance company and then, if necessary, to an external reviewer. When: Effective for some health plans now Who benefits: People with private health insurance (Employer sponsored or individual plans)
Rebuild primary care workforce
Expand the number of primary care doctors, nurses and physician assistants through incentives such as scholarships and loan repayments for primary care doctors and nurses working in underserved areas.
SHORING UP THE HEALTH CARE SYSTEM Minimum medical spending by insurers
The law requires health plans to report the proportion of premium dollars spent on clinical services and quality measures, as opposed to administrative costs. If that proportion is less than 85% for largeemployer plans and 80% for plans sold to individuals and small employers, consumers would be due rebates. When: The rebate program takes effect Jan. 1, 2011. Who benefits: Consumers with health insurance Who pays more: Health insurance companies
CHILDREN AND ADULTS UNDER 26 YEARS OLD Kids with pre-existing conditions can’t be denied coverage
Insurers cannot deny coverage to children under the age of 19 due to a pre-existing medical condition. Who benefits: Children with pre-existing conditions Who pays more: Insurance companies
SHORING UP THE HEALTH CARE SYSTEM Free preventive care, wellness initiative
All new health plans must cover preventive services such as mammograms and colonoscopies with no deductible, co-pay or coinsurance. A $15 billion Prevention and Public Health Fund will pay for programs to help people get healthy — from quitting smoking to fighting obesity. Who benefits: People enrolled in job-related health plans or individual health plans created after March 23, 2010.
No lifetime dollar limits
Health plans can no longer impose lifetime dollar limits on what they will pay for essential benefits, like hospital stays. Annual dollar limits will also be restricted. When: Now. Annual dollar limits will be phased out by 2014, with some exceptions. Who benefits: People with private health insurance
Strengthen health centers
New funding will pay for construction and service expansions of community health centers, enabling these centers to serve some 20 million new patients. Who benefits: Uninsured and lowincome people. Who pays more: Federal government
Free preventive care for seniors
The law provides certain free preventive services for Medicare recipients, such as annual wellness visits and personalized prevention plans. It also waives the Medicare deductible for colorectal cancer screening tests. When: Effective Jan. 1, 2011 Who benefits: Medicare recipients Who pays more: Federal government
Extend coverage for young adults
Young adults can stay on their parents’ plan until they turn 26 years old. Who benefits: Adults under 26 who can’t get insurance at work Who pays more: Insurance companies
Restrictions on canceling sick person’s coverage
In the past, insurance companies could search for any error on a consumer’s application and use the error to deny payment for services or cancel coverage when the insured got sick. Now insurers must prove the effort was fraudulent. Who benefits: People with individual health insurance Who pays more: Healthinsurance companies
Curb rate hikes
States that require insurance companies to justify their premium increases will be eligible for $250 million in new grants. Insurance companies with unjustified premium increases may not be able to participate in the new health insurance exchanges in 2014. When: Grants are awarded now. Who benefits: People with private health insurance
More pay for rural health care providers
Sixty-eight percent of medically underserved communities in the U.S. are in rural areas. Increased payments to rural health-care providers could help attract and retain medical professionals to these areas. Who benefits: Rural residents and healthcare professionals. Who pays more: Federal government
Medicare premiums for higher-income beneficiaries
The income threshold for higher Medicare Part B premiums will be frozen at 2010 levels for 2011 through 2019, resulting in more people paying the higher premiums. Also, the premium subsidy for Medicare prescription drug coverage will be reduced for those with incomes above $85,000/individual and $170,000/couple. When: Effective Jan. 1, 2011 Who benefits: The Medicare budget Who pays more: Higher-income Medicare
Improving Medicare, Medicaid
A new Center for Medicare & Medicaid Innovation will test new ways to deliver care and pay providers. The goal is to reduce the growth in costs for Medicare, Medicaid, and the Children’s Health Insurance Program while maintaining or improving the quality of care. When: Effective Jan. 1, 2011 Who benefits: Medicare, Medicaid and CHIP recipients
SMALL BUSINESSES Tax credits for buying coverage
Up to 4 million small businesses could get tax credits to help provide health coverage to their employees. When: Starting now the first phase provides a credit up to 35
2012
THE DISABLED Providing new, voluntary options for long-term care
The law creates a voluntary long-term care insurance program to provide cash benefits to disabled adults. When: Government must designate a benefit plan by Oct. 1, 2012 Who benefits: Disabled individuals Who benefits: Medicare patients, high-quality hospitals
LATER YEARS
SHORING UP THE HEALTH CARE SYSTEM Medicare tax increase SHORING UP THE HEALTH CARE SYSTEM Electronic health records
A series of gradual changes will require health plans to keep and exchange records electronically. The goal is to reduce medical errors and paperwork costs. When: First regulation effective Oct. 1, 2012 Who benefits: Health care system, patients Increases the Medicare Part A (hospital insurance) tax rate on wages, to 2.35% from 1.45%, on earnings over $200,000 for individual taxpayers and $250,000 for married couples filing jointly; imposes a 3.8% assessment on unearned income for higher-income taxpayers. When: Effective Jan. 1, 2013 Who benefits: The Medicare budget Who pays more: Higherincome taxpayers. Who benefits: The federal budget Who pays more: Mid-size and large employers that don’t provide health coverage
Health insurance exchanges
New state-based health insurance marketplaces called exchanges will be established, through which individuals and small businesses can choose from among health plans meeting benefit and cost standards. Members of Congress will be getting their health coverage through these exchanges. When: Effective Jan. 1, 2014 Who benefits: Individuals and small businesses needing more affordable coverage
LOW INCOME AND THOSE WITH PREEXISTING ILLNESSES Extend preventive care for state Medicaid programs
The law provides a onepercentage-point increase in federal matching Medicaid funds for preventive services to states that cover certain preventive services at little or no cost to patients. When: Effective Jan. 1, 2013 Who benefits: Medicaid recipients Who pays more: Federal government
More access to Medicaid
Americans who earn less than 133 percent of the poverty level (about $14,000 for an individual and $29,000 for a family of four) will be eligible for Medicaid. States will receive 100 percent federal funding for the first three years to support this expansion, phasing to 90 percent in subsequent years. When: Effective Jan. 1, 2014 Who benefits: Low-income individuals and families Who pays more: Federal government
Individual requirement to have insurance
Most individuals who can afford it will be required to obtain basic health insurance coverage or pay a fee to help offset the costs of caring for uninsured Americans. If affordable coverage is not available to an individual, he or she will be eligible for an exemption. When: Effective Jan. 1, 2014 Who benefits: Uninsured people, health-care providers Who pays more: Previously uninsured individuals
Fees from drug makers
The law imposes new annual or biennial fees on the pharmaceutical manufacturing industry. When: Beginning with $2.8 billion in 2012-2013 Who benefits: Taxpayers Who pays more: Pharmaceutical manufacturers
Apply employers’ funds to other coverage
Some workers who can’t afford the coverage offered at work will be able to take whatever amount their employer would have paid toward their insurance and use it to buy a more affordable plan though the new health insurance exchanges. When: Effective Jan. 1, 2014 Who benefits: Low- and moderate-income workers
SENIORS Medicare hospital quality incentives
Hospitals’ Medicare pay will be based on performance on certain quality measures. Hospitals’ performance must be publicly reported, beginning with measures relating to heart attacks, heart failure, pneumonia, surgical care, health-care associated infections, and patients’ perception of care. When: Effective Oct. 1, 2012
Guaranteed availability of insurance
Insurers cannot refuse to sell coverage or renew policies because of an individual’s pre-existing medical condition. Also, in the individual and small-employer markets, it will be illegal to charge higher rates because of gender or health status. When: Effective Jan. 1, 2014 Who benefits: Individuals with pre-existing conditions or poor health Who pays more: Insurance companies
Help for health care costs
Tax credits will be available for people with incomes above 133 percent but below 400 percent of poverty (about $43,000 for an individual and $88,000 for a family of four in 2010) to help them buy insurance, if they not eligible for or offered other affordable coverage. When: Effective Jan. 1, 2014 Who benefits: Low-income individuals, families Who pays more: Federal government
Reduce health disparities
The law requires the collection and reporting of patients’ racial, ethnic, language, and gender data to identify and address health disparities. When: Effective March 2012 Who benefits: Patients
Employer requirements
Employers with more than 50 employees that don’t offer health coverage will be assessed per-employee fees if they have at least one full-time employee who receives a tax credit for buying his or her own health coverage. When: Effective Jan. 1, 2014
Fees from health insurers
The law imposes new annual or biennial fees on the health insurance industry. When: Beginning with $8 billion in 2014 Who benefits: The federal budget Who pays more: Health insurers
LOW INCOME, THOSE WITH PRE-EXISTING ILLNESSES, AND THE DISABLED States can cover more people through Medicaid
States can choose to receive federal matching funds to childless adults with incomes up to 133 percent of the federal poverty level, a higher threshold than before. Who benefits: Low-income childless adults percent of the employer’s contribution to employees’ health insurance; this ceiling will increase to 50 percent in 2014. Also, small non-profit organizations now may receive up to a 25 percent credit, increasing to 35 percent in 2014. Who benefits: Small businesses with fewer than 25 employees Who pays more: Federal government
HEALTH CARE
The Democrats’ overhaul of the nation’s health care system will unfold over the next 10 years. Here are the changes taking place now and in the next few years.
NEXT YEAR
THE DISABLED Home care for the disabled
The new Community First Choice Option allows state Medicaid programs to offer home- and community-based services to disabled individuals rather than nursing-home care. When: Effective Oct. 1, 2011 Who benefits: Disabled individuals Who pays more: Federal government and states beneficiaries
REFORM
Reducing payments to Medicare Advantage insurers
The law gradually eliminates the extra amount that Medicare pays per person to private insurers’ Medicare Advantage plans compared with outlays under traditional Medicare. The law also prohibits Medicare Advantage plans from imposing higher cost-sharing requirements than traditional Medicare for some covered services. When: Effective Jan. 1, 2011 Who benefits: The Medicare budget Who pays more: In effect, health insurers because they’ll receive less
Coverage for uninsured people with pre-existing conditions
A new temporary program provides coverage for people with pre-existing medical conditions who have been uninsured for at least six months. States may set up their own programs; if they don’t, residents can apply for coverage through a national plan. When: National program is in effect now Who benefits: Uninsured people with pre-existing conditions
SENIORS Expand coverage for early retirees
A $5 billion reinsurance program helps employmentbased plans extend coverage to people who retire between the ages of 55 and 65, as well as their spouses and dependents. Who benefits: Early retirees
Thinkstock photos
SENIORS Prescription drug discounts
Drug manufacturers must provide a 50% discount on brand-name prescriptions for seniors with Medicare drug plans who reach the “doughnut hole” coverage gap. Also, federal subsidies begin for generic prescriptions filled during that coverage gap. When: Effective Jan. 1, 2011. Over the next 10 years, discounts will increase until the coverage gap is closed in 2020. Who benefits: Medicare drug-plan members who reach the “doughnut hole” Who pays more: Drug manufacturers, federal government
Cuttings costs to preserve Medicare
The Independent Payment Advisory Board will propose ways to reduce the growth in Medicare spending and extend the life of the Medicare Trust Fund. When: Funding available Oct. 1, 2011 Who benefits: Medicare recipients
“Doughnut hole” $250 rebate
Seniors who reach the “Doughnut Hole” in Medicare prescription coverage this year — after their drug costs for the year reaches $2,840 — receive a $250 rebate. Who benefits: Seniors in the Medicare prescription gap Who pays: Federal government
Right to appeals claims denials
Consumers have the right to appeal coverage claims denials to their insurance company and then, if necessary, to an external reviewer. When: Effective for some health plans now Who benefits: People with private health insurance (Employer sponsored or individual plans)
Rebuild primary care workforce
Expand the number of primary care doctors, nurses and physician assistants through incentives such as scholarships and loan repayments for primary care doctors and nurses working in underserved areas.
SHORING UP THE HEALTH CARE SYSTEM Minimum medical spending by insurers
The law requires health plans to report the proportion of premium dollars spent on clinical services and quality measures, as opposed to administrative costs. If that proportion is less than 85% for largeemployer plans and 80% for plans sold to individuals and small employers, consumers would be due rebates. When: The rebate program takes effect Jan. 1, 2011. Who benefits: Consumers with health insurance Who pays more: Health insurance companies
CHILDREN AND ADULTS UNDER 26 YEARS OLD Kids with pre-existing conditions can’t be denied coverage
Insurers cannot deny coverage to children under the age of 19 due to a pre-existing medical condition. Who benefits: Children with pre-existing conditions Who pays more: Insurance companies
SHORING UP THE HEALTH CARE SYSTEM Free preventive care, wellness initiative
All new health plans must cover preventive services such as mammograms and colonoscopies with no deductible, co-pay or coinsurance. A $15 billion Prevention and Public Health Fund will pay for programs to help people get healthy — from quitting smoking to fighting obesity. Who benefits: People enrolled in job-related health plans or individual health plans created after March 23, 2010.
No lifetime dollar limits
Health plans can no longer impose lifetime dollar limits on what they will pay for essential benefits, like hospital stays. Annual dollar limits will also be restricted. When: Now. Annual dollar limits will be phased out by 2014, with some exceptions. Who benefits: People with private health insurance
Strengthen health centers
New funding will pay for construction and service expansions of community health centers, enabling these centers to serve some 20 million new patients. Who benefits: Uninsured and lowincome people. Who pays more: Federal government
Free preventive care for seniors
The law provides certain free preventive services for Medicare recipients, such as annual wellness visits and personalized prevention plans. It also waives the Medicare deductible for colorectal cancer screening tests. When: Effective Jan. 1, 2011 Who benefits: Medicare recipients Who pays more: Federal government
Extend coverage for young adults
Young adults can stay on their parents’ plan until they turn 26 years old. Who benefits: Adults under 26 who can’t get insurance at work Who pays more: Insurance companies
Restrictions on canceling sick person’s coverage
In the past, insurance companies could search for any error on a consumer’s application and use the error to deny payment for services or cancel coverage when the insured got sick. Now insurers must prove the effort was fraudulent. Who benefits: People with individual health insurance Who pays more: Healthinsurance companies
Curb rate hikes
States that require insurance companies to justify their premium increases will be eligible for $250 million in new grants. Insurance companies with unjustified premium increases may not be able to participate in the new health insurance exchanges in 2014. When: Grants are awarded now. Who benefits: People with private health insurance
More pay for rural health care providers
Sixty-eight percent of medically underserved communities in the U.S. are in rural areas. Increased payments to rural health-care providers could help attract and retain medical professionals to these areas. Who benefits: Rural residents and healthcare professionals. Who pays more: Federal government
Medicare premiums for higher-income beneficiaries
The income threshold for higher Medicare Part B premiums will be frozen at 2010 levels for 2011 through 2019, resulting in more people paying the higher premiums. Also, the premium subsidy for Medicare prescription drug coverage will be reduced for those with incomes above $85,000/individual and $170,000/couple. When: Effective Jan. 1, 2011 Who benefits: The Medicare budget Who pays more: Higher-income Medicare
Improving Medicare, Medicaid
A new Center for Medicare & Medicaid Innovation will test new ways to deliver care and pay providers. The goal is to reduce the growth in costs for Medicare, Medicaid, and the Children’s Health Insurance Program while maintaining or improving the quality of care. When: Effective Jan. 1, 2011 Who benefits: Medicare, Medicaid and CHIP recipients
SMALL BUSINESSES Tax credits for buying coverage
Up to 4 million small businesses could get tax credits to help provide health coverage to their employees. When: Starting now the first phase provides a credit up to 35
2012
THE DISABLED Providing new, voluntary options for long-term care
The law creates a voluntary long-term care insurance program to provide cash benefits to disabled adults. When: Government must designate a benefit plan by Oct. 1, 2012 Who benefits: Disabled individuals Who benefits: Medicare patients, high-quality hospitals
LATER YEARS
SHORING UP THE HEALTH CARE SYSTEM Medicare tax increase SHORING UP THE HEALTH CARE SYSTEM Electronic health records
A series of gradual changes will require health plans to keep and exchange records electronically. The goal is to reduce medical errors and paperwork costs. When: First regulation effective Oct. 1, 2012 Who benefits: Health care system, patients Increases the Medicare Part A (hospital insurance) tax rate on wages, to 2.35% from 1.45%, on earnings over $200,000 for individual taxpayers and $250,000 for married couples filing jointly; imposes a 3.8% assessment on unearned income for higher-income taxpayers. When: Effective Jan. 1, 2013 Who benefits: The Medicare budget Who pays more: Higherincome taxpayers. Who benefits: The federal budget Who pays more: Mid-size and large employers that don’t provide health coverage
Health insurance exchanges
New state-based health insurance marketplaces called exchanges will be established, through which individuals and small businesses can choose from among health plans meeting benefit and cost standards. Members of Congress will be getting their health coverage through these exchanges. When: Effective Jan. 1, 2014 Who benefits: Individuals and small businesses needing more affordable coverage
LOW INCOME AND THOSE WITH PREEXISTING ILLNESSES Extend preventive care for state Medicaid programs
The law provides a onepercentage-point increase in federal matching Medicaid funds for preventive services to states that cover certain preventive services at little or no cost to patients. When: Effective Jan. 1, 2013 Who benefits: Medicaid recipients Who pays more: Federal government
More access to Medicaid
Americans who earn less than 133 percent of the poverty level (about $14,000 for an individual and $29,000 for a family of four) will be eligible for Medicaid. States will receive 100 percent federal funding for the first three years to support this expansion, phasing to 90 percent in subsequent years. When: Effective Jan. 1, 2014 Who benefits: Low-income individuals and families Who pays more: Federal government
Individual requirement to have insurance
Most individuals who can afford it will be required to obtain basic health insurance coverage or pay a fee to help offset the costs of caring for uninsured Americans. If affordable coverage is not available to an individual, he or she will be eligible for an exemption. When: Effective Jan. 1, 2014 Who benefits: Uninsured people, health-care providers Who pays more: Previously uninsured individuals
Fees from drug makers
The law imposes new annual or biennial fees on the pharmaceutical manufacturing industry. When: Beginning with $2.8 billion in 2012-2013 Who benefits: Taxpayers Who pays more: Pharmaceutical manufacturers
Apply employers’ funds to other coverage
Some workers who can’t afford the coverage offered at work will be able to take whatever amount their employer would have paid toward their insurance and use it to buy a more affordable plan though the new health insurance exchanges. When: Effective Jan. 1, 2014 Who benefits: Low- and moderate-income workers
SENIORS Medicare hospital quality incentives
Hospitals’ Medicare pay will be based on performance on certain quality measures. Hospitals’ performance must be publicly reported, beginning with measures relating to heart attacks, heart failure, pneumonia, surgical care, health-care associated infections, and patients’ perception of care. When: Effective Oct. 1, 2012
Guaranteed availability of insurance
Insurers cannot refuse to sell coverage or renew policies because of an individual’s pre-existing medical condition. Also, in the individual and small-employer markets, it will be illegal to charge higher rates because of gender or health status. When: Effective Jan. 1, 2014 Who benefits: Individuals with pre-existing conditions or poor health Who pays more: Insurance companies
Help for health care costs
Tax credits will be available for people with incomes above 133 percent but below 400 percent of poverty (about $43,000 for an individual and $88,000 for a family of four in 2010) to help them buy insurance, if they not eligible for or offered other affordable coverage. When: Effective Jan. 1, 2014 Who benefits: Low-income individuals, families Who pays more: Federal government
Reduce health disparities
The law requires the collection and reporting of patients’ racial, ethnic, language, and gender data to identify and address health disparities. When: Effective March 2012 Who benefits: Patients
Employer requirements
Employers with more than 50 employees that don’t offer health coverage will be assessed per-employee fees if they have at least one full-time employee who receives a tax credit for buying his or her own health coverage. When: Effective Jan. 1, 2014
Fees from health insurers
The law imposes new annual or biennial fees on the health insurance industry. When: Beginning with $8 billion in 2014 Who benefits: The federal budget Who pays more: Health insurers
