House Republicans will vote today to repeal the Obama administration’s health care reform bill approved and adopted as law in March of last year. They will be successful in the House and they will be unsuccessful in the Senate.
The Republicans know they will lose. They are planning to use the defeat to rally the Tea Partiers and conservatives to undertake a two year campaign that they hope will do enough damage to the President that it will give whoever they put up against him in 2012 a chance of winning.
Between now and the Presidential election of 2012, the Republicans will use every tool a majority Party has available to chip away at the law. Newly appointed Republican Committee Chairs are lining up to grab an administration official and grill him or her to prove that the law it is what they have claimed it to be – “socialized medicine.”
Unfortunately, the Health care law is not “socialized medicine.” If it were, the medical establishment, pharmasuical industry, health insurance industry, and others would all be out of work, as the government would be performing the services these industries currently dispense at a very hefty profit.
While casting about for the votes necessary to get his health care legislation approved last year, the President allowed it to be watered down so much that the best way to decribe what was eventually adopted is a change in health insurance. The key provisions in the law decrease barriers for obtaining health coverage, as well as accessing needed health care services. The law bars health plans from:
· Denying coverage to those with pre-existing medical conditions
· Dropping the coverage of people who become sick
· Charging higher premiums because of health issues
Under the way things currently “work,” those of us who have health insurance and pay our premiums end up paying higher premiums if someone in our healthcare plan fails to pay their premiums. In addition, if those who are uninsured – generally those with low or no incomes and illegal immigrants – remain uninsured, we taxpayers are required to pick up the tab when they require medical care.
The provision of the health care law that has the Republicans apoplectic is the requirement that after the legislation is fully implemented in 2014, all Americans will be required to have health insurance through their employer, through a public program such as Medicaid or Medicare, or by purchasing coverage from a state-based health insurance exchange.
For those who have health insurance, depending on the type of coverage, there are multiple options with the implementation of the law. If an individual’s health coverage is through an employer plan, some options include:
· Stay in your employer plan: If your employer continues to offer health insurance, you can keep it.
· Shop for a health plan through the health insurance exchange in your state: If you own a small business, or your employer offers only minimal benefits, or you must pay more than 9.5% of your income in premiums, you can look for better options in the exchange.
· Participate in long-term care insurance: A new payroll deduction at work will allow you to qualify for long-term care benefits after a five-year waiting period. The program is voluntary.
If a person’s source of health insurance is an individual policy that was purchased for themselves and/or their families, these are your options:
· Keep your current plan: If your health plan continues to offer the same coverage, you can renew it. However, new health insurance policies must comply with federal minimum coverage standards; older health plans that don't meet these standards cannot enroll new customers.
· Shop for coverage through the insurance exchange in your state: If your income is below $43,320, you may qualify for federal tax credits to help offset the cost of your premium.
The Republicans claim to be concerned about the provision in the law that requires those who do not obtain health insurance to pay a penalty, unless they qualify for certain exemptions. However, depending on income, family size, and state of residence, there will be several health coverage options, including financial subsidies if health insurance is unaffordable.
Middle class individuals and families who are not considered “poor” but that have difficulty making ends meet will be eligible to buy a subsidized health plan through a state-based health insurance exchange starting in 2014. Annual incomes of those eligible are up to $43,320 for an individual and up to $88,200 for a family of four.
Health plans that participate in an exchange must offer a package of "essential" benefits that covers at least 60% of health care expenses.
If health insurance is purchased from an exchange, an individual’s share of the premium may not exceed a certain percent of his or her income, ranging from 2% to 9.5% depending on how much they make each year.
Small employers that provide health insurance coverage will receive tax credits. The new credit helps small businesses and small tax-exempt organizations afford the cost of covering their employees. It is intended for those with low- and moderate-income workers. The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have. In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees.
Before the Republicans begin to complain about the harm the heath insurance reform legislation will do to “small businesses,” there is a provision in the law that identifies what a small business is and what is required of it:
· Assesses employers with more than 50 employees that do not offer coverage and have at least one full- time employee who receives a premium tax credit a fee of $2,000 per full-time employee, excluding the first 30 employees from the assessment.
· Employers with more than 50 employees that offer coverage but have at least one full-time employee receiving a premium tax credit will pay the lesser of $3,000 for each employee receiving a premium credit or $2,000 for each full-time employee. (Effective January 1, 2014)
· Exempts employers with 50 or fewer employees from any of the above penalties.
· Requires employers that offer coverage to their employees to provide a free choice voucher to employees with incomes less than 400% FPL whose share of the premium exceeds 8% but is less than 9.8% of their income and who choose to enroll in a plan in the Exchange. The voucher amount is equal to what the employer would have paid to provide coverage to the employee under the employer’s plan and will be used to offset the premium costs for the plan in which the employee is enrolled. Employers providing free choice vouchers will not be subject to penalties for employees that receive premium credits in the Exchange. (Effective January 1, 2014)
· Employers with more than 200 employees must automatically enroll employees into health insurance plans offered by the employer. Employees may opt out of coverage.
Medicare
Payments to Medicare Advantage (MA) plans will be restructured by setting payments to different percentages of Medicare fee-for-service (FFS) rates, with higher payments for areas with low FFS rates and lower payments (95% of FFS) for areas with high FFS rates. There will be a phase-in of revised payments over 3 years beginning in 2011, for plans in most areas, with payments phased-in over longer periods (4 years and 6 years) for plans in other areas. Bonused will be provided to plans receiving 4 or more stars, based on the current 5-star quality rating system for Medicare Advantage plans, beginning in 2012 and qualifying plans in qualifying areas receive double bonuses.
The new law modifies the rebate system with rebates allocated based on a plan’s quality rating. Adjustments to plan payments for coding practices related to the health status of enrollees will be phased in, with adjustments equaling 5.7% by 2019.
There will be a cap on total payments, including bonuses, at current payment levels. Medicare Advantage plans will be requitred to remit partial payments to the Secretary if the plan has a medical loss ratio of less than 85%, beginning 2014. Plan enrollment will be suspended for 3 years if the medical loss ratio is less than 85% for 2 consecutive years and to terminate the plan contract if the medical loss ratio is less than 85% for 5 consecutive years.
Annual market basket updates for inpatient hospital, home health, skilled nursing facility, hospice and other Medicare providers will be reduced and adjusted for productivity. The threshold for income-related Medicare Part B premiums for 2011 through 2019 will be frozen, and the Medicare Part D premium subsidy for those with incomes above $85,000/individual and $170,000/ couple will be reduced. (Effective January 1, 2011)
Prescription Drugs
The Food and Drug Administration is authorized to approve generic versions of biologic drugs and grant biologics manufacturers 12 years of exclusive use before generics can be developed.
Heath Insurance Companies
There are other provisions to the health Care Law, but a telling development augers well for the Obama administration. The entire health insurance industry opposed the Health Care Law before it was approved. In fact, many opposed it before they even knew what it would do. The talking pints they used were that it would impose onerous new regulations and reforms that would kill their business and make health care unsustainable. However, many, especially those in the health insurance industry, have realized that the health care reform law will help them and other big stakeholders. The law, they have observed, will not disrupt the health industry. In fact, it is likely to bring insurers new business.
So far, the major elements of health reform that were opposed on principle —including the individual mandate and insurance exchanges — have been working well for all involved. In fact, there is every reason to believe that that other components will be phased in as planned, with little disruption and certainly without ruining health care or the industries that opposed the legislation initially.
Perhaps that is why the Republicans have yet to offer up an alternative to what they are so eager to tear down.
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