Posts Tagged ‘Reform’

What Will Health Insurance Plan Reform Do For You Right Now?

February 5th, 2011

Many of the effects of healthcare reform legislation pending in Congress will not be evident for several years. For example, the health insurance plan exchange market and accompanying subsidies for low- and moderate-income individuals are not set to be complete until 2014. Yet, the American public is being asked to begin paying for it today, through various taxes and mandates. Supporters believe that it is a worthwhile investment that will reduce the uninsured population and lead to lower health insurance premiums in the long run, but it is a hard pill to swallow.

However, some provisions will have a more immediate impact. More stringent regulations on insurance companies will take effect as soon as President Obama signs a bill into law. The individual health insurance plan market will become more friendly to consumers as a result. These regulations include a ban on lifetime or annual limits on coverage, bringing peace of mind to those who are unknowingly underinsured: many medical bankruptcies are caused by expensive treatments for cancer or other serious diseases. A lifetime limit of $1 million initially seems generous, but a several-months-long hospital stay and a few rounds of chemotherapy and radiation may soar past that mark. The government will start enforcing this ban six months after the healthcare reform bill passes.

Meanwhile, those with pre-existing conditions are also in luck. Currently, finding a health insurance plan that will cover someone with any chronic diagnosis–even if the condition is manageable with regular medications–is difficult or impossible, unless they have access to insurance through their employer or a family member. Regardless of whether the legislation ends up looking more like the House of Representatives’ version or that of the Senate, finding a suitable plan will be easier. For young adults out of college, many of whom have incomes too low to afford an individual health insurance plan and/or lack full-time employment with insurance benefits, the fact that they will be able to continue their coverage under a parent’s plan for a longer period of time is also reassuring. Depending on which version makes the final cut, they can stay on those plans until they are either 26 or 27 years old.

Another immediately effective limitation on the health insurance industry is related to administrative costs. CEO salaries, shareholder profits, and bloated corporate infrastructure are largely blamed for the increasing cost of a health insurance plan. A provision in the healthcare reform bill would require that insurers spend 80-85% of the premiums they collect on medical care, as opposed to other expenses. It is hoped that such a regulation will either lower health insurance plan premiums or increase the quality of care in the individual health insurance market. Skeptics claim that it will force some insurance companies out of the market, and leave many in the lurch before the regulated exchange markets are up and running.

The uninsured have received a lot of attention in the debate over healthcare reform. While the bulk of the programs meant to provide them with a health insurance plan will take time to set up, both chambers of Congress have taken steps to ensure that they are cared for in the meantime. The House has proposed the creation of a temporary insurance program for those unable to acquire coverage, much like the high-risk insurance pools in many states. Meanwhile, the Senate has allocated $5 billion for another temporary program for the uninsured with pre-existing conditions. Although the former would take effect immediately, the latter would only become effective 90 days after the bill is passed. It is very likely that some form of assistance will survive the final negotiations.

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Will Reform of Health Insurance Plans Go to Supreme Court?

February 1st, 2011

Opponents of healthcare reform failed to prevent bills passing in the Senate and the House of Representatives. These Democratic-sponsored bills seek to provide health insurance plans to the millions of uninsured Americans. Republicans, among those opposed to reform, raised the specter of socialized medicine and drew attention to the soaring cost of the legislation. Although they managed to kill the government-run public option in the Senate bill, their protests largely fell on deaf ears.

When it comes to this issue, conservatives are down but not out. President Obama has vowed to sign the combined bill once it reaches his desk, thereby making it into law. At that point, healthcare reform is open to a judicial challenge. Some people are now considering the possibility that parts of the healthcare reform bill, as enacted, may be unconstitutional. Moreover, they are willing to bring the issue to the Supreme Court if need be.

The proposal of involving the court system appears slightly unusual. After all, much of the contingent that has expressed vociferous disapproval for healthcare reform has also railed against what they consider to be “activist judges” who are “legislating from the bench” in the past. Nevertheless, some constitutional questions have been raised.

For example, some conservative legal scholars have said that the individual mandate–which requires all Americans to buy health insurance plans or pay a fine–is unconstitutional. They believe that such a mandate would only be constitutional under a far too loose interpretation of the Commerce Clause, and would allow the federal government to require any kind of purchase from a private company. If that provision was struck down as unconstitutional, it would be a severe blow to both the House and Senate legislation. The insurance mandate is essential for insurers’ cooperation with new regulations and a centerpiece in their reform strategy: bringing healthier, uninsured individuals into the nation’s health insurance pool would supposedly lower costs for all.

If the mandate for individuals to acquire health insurance plans sounds like state laws that force individuals to buy auto insurance, it is because the two are very similar. The latter has been found to be legal, even though it mandates the purchase of a particular project. On the other hand, unlike people who don’t own a car in order so they don’t have to pay for auto insurance, there is no way to forgo the human body in order to avoid paying for one of the many health insurance plans available. Opposition to the mandate on legal grounds is largely based on the opinion that the fines that would be imposed for noncompliance are not included in the right of Congress to levy and collect taxes. Moreover, the inactivity of individuals who fail to buy health insurance plans would not qualify as interstate commerce, and as a result cannot be regulated by the federal government.

Regardless, the issue is probably moot. As an important, high priority piece of legislation, the healthcare reform bill has most likely gone through stringent vetting to ensure the legality of all its provisions. Supporters would not want to see their efforts fall short due to a constitutional law mishap anywhere in the 2,000-plus page legislation. Senator Max Baucus and other Democrats have made this very point, while accusing Republicans of grasping at straws to stop the nation’s reform of health insurance plans. Nevada Republican John Ensign recently proposed that the Senate vote on a point of order acknowledging that the healthcare reform bill was unconstitutional due to the individual mandate. Unsurprisingly, it failed strictly along party lines; the entire Democratic caucus voted against it, while all Republicans were in favor.

Most mainstream legal scholars reject these arguments against the healthcare reform bills. They point to the fact that past Supreme Court rulings have allowed Congress to regulate activities that, even if they are not interstate commerce in and of themselves, “substantially affect” such commerce. By that definition, there is no doubt that whether or not people buy health insurance plans qualifies. Therefore, the case is unlikely to reach the Supreme Court. If healthcare reform legislation actually made it past the lower courts and reached them, how would the Court rule? Most likely, the ruling would be split among ideological lines. With liberal Justice Sonia Sotomayor replacing fellow left-leaning Justice David Souter, the balance between conservative and liberal justices has been maintained. Justice Anthony Kennedy tends to be the swing voter; on business issues, he has tended to lean conservative and take positions in favor of free markets. Still, the Court must judge based on precedent, and would probably uphold the legality of the individual health insurance mandate.

(Image: Kyle Rush under CC 2.0)

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How Health Reform Will Affect You

January 22nd, 2011

Ever since President Obama came to the Oval Office, America has been waiting with baited breath to see if he would come true with his promises to change American health care. And it sounds like he has. If you have heard about all of the amazing changes to health care, but aren’t quite sure what this will mean in your everyday life, read here to see just what changes to health care Obama’s new health care reform have provided. After one of the most heated political debates in decades, Congress has finally passed a health reform policy in March 2010 that will mean universal health care for you over the next four years. Other countries all over the globe, like Canada for instance, offer their citizens public health care that is paid for and administrated by government health agencies. This option was discussed in Congress to meet Obama’s goal of health care for all America. Though the issue of creating a national and public health coverage was not accepted by Congress, that of the universal health care reform was and this is the best news for health care America has seen in some time. Though America’s health care will not be run by the government as is done in many other countries, it will during the next four years mandate national health coverage meaning.

What does this mean for you? You will never be denied health care again, and this is how it is going to work. Starting in the year 2014, every citizen and legal resident of the United States is required to have health coverage, and insurance companies will no longer be able to say no to people with pre-existing conditions. Public health care options will not be mandated, but will be available for families that qualify through a program that is being described as “expanded Medicaid”. And though programs such as Medicaid will assist families that fall below federal poverty levels, the government will continue to step in by providing subsidies to American families that earn between 100-400% of current poverty levels. No longer will any American be able to worry about not being able to afford health care. In addition to subsidies, health care reform brings many changes to how insurance companies will be able to work and provide medical coverage.

The government is proposing that mandated state-run health exchanges be initiated in order to provide every possible opportunity for affordable health care. Cost share programs are also being instigated, as are health care protection cost gaps being considered to help you and your family get the health care you need. The health care reform policy is known as the 2010 Patient Protection and Affordable Care Act, and is designed to protect American families from missing out on valuable health care due to costs. Though this is not a policy without controversy, it does offer many Americans renewed hope that they will soon be able to enjoy the advantages of health insurance. This program is to begin this year, and will begin with children being the first to be considered for cheap health insurance plans that they previously may not have been eligible for. Over the next four years, all of America will be required to hold health insurance, and will be able to do so at a cost you can afford.

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After Reform, Millions Will Still Lack Affordable Health Insurance

January 13th, 2011

A recent report from the Congressional Budget Office highlights the continual struggle of providing affordable health insurance to all Americans. Healthcare reform legislation recently passed by the Senate will cost over $800 billion while making significant regulatory and structural changes to the current health insurance system. While the goal of proponents is to extend coverage to the entire U.S. population, it appears that they will fall short in enacting universal health care.

Shockingly, only about 92% of people under 65% years of age will be insured by 2018. Many of the most drastic changes, such as a highly-regulated federal health insurance market with subsidies for low- and middle-income individuals, will not take effect for several years. Moreover, the nonpartisan office estimates that approximately 31 million currently uninsured Americans will have access to affordable health insurance due to the bill. Still, the estimates are sobering to Democrats; they are simultaneously providing ammunition to Republican politicians who claim that the costs are far too high to undertake a strategy that will not even work effectively. The White House points the finger at conservatives in Congress for blocking further expansions of coverage, while touting the Senate bill as a striking improvement from the status quo.

The primary question many have is this: how did so many uninsured individuals and families fall through the cracks? Despite the Senate’s bill clocking in at over 2,000 pages long, some groups are left out, either by accident or on purpose. The former group mainly consists of younger individuals–considered to be those under 30–in good health, a demographic which often chooses to forgo coverage even if affordable health insurance is available to them. Healthcare reform legislation includes a mandate that will soon make that choice more costly. As of 2014, individuals over a certain income level who refuse to buy health insurance will be fined. The goal is to have them become insured; not only is it necessary to avoid possible financial ruin in the event of a catastrophic medical emergency, but their inclusion is also needed in the health insurance pool to reduce medical costs.

Massachusetts has had a similar law for several years, which has reduced the percentage of uninsured in this population. There are about 13 million in this group nationwide, so just making a dent will be helpful. However, some individuals prefer to pay the annual fines (which range from several hundred to over one thousand dollars) in lieu of purchasing insurance. This accounts for some of these Americans who will remain uninsured after reform. It does not even include those people for whom health insurance would cost over eight percent of their annual income; they will be exempt from the health insurance mandate entirely.

Another group already has access to affordable health insurance, but is not taking advantage of it. Hundreds of thousands of Americans are eligible for Medicaid, the federal health insurance program for the poor. With the new Senate bill, individuals and families living in households making under $30,000 per year can qualify for the plan. For various reasons, they have not signed up. Explanations for this range from difficulty filling out forms to embarrassment and lack of publicity. More households will be covered under the existing program, which some experts predict will further decrease the population of the uninsured. Reform supporters claim that there are always a handful of stragglers–even European nations with free universal, socialized health care fall just short of the 100% mark.

On the other hand, illegal immigrants were purposely excluded from the legislation. Coverage for the millions of individuals in America without legal status has been a very controversial issue among both politicians and the public. The bill was expensive and complicated enough to pass with solely U.S. citizens and legal residents. While some liberal Democrats and activists fought the exclusion, it remained intact in the Senate, as well as the House of Representatives. Illegal immigrants are already forbidden from using Medicaid or any other type of public health insurance, but are commonly seen in hospital emergency rooms. They are often treated for conditions that could be handled far more cost-effectively in a doctor’s office, yet resort to the ER at a high cost to state and local governments.

Neither party is willing to offer affordable health insurance subsidies to illegal immigrants, or allow them on an existing program such as Medicaid. The Senate’s bill goes farther to keep them out, however: it will forbid them from using the discounted health insurance exchange markets the legislation will create. In contrast, the House version will allow illegal immigrants to buy coverage in those markets, as long as they only use their money. The future of this provision must be negotiated in committee, so it is unknown whether the ban will become law. There is another prominent concern; the Latino population, whether or not they have legal status, skews younger than the general American population–which puts many of them in the younger age groups shown to be less willing to buy insurance. Therefore, the amount of illegal immigrants who would actually take advantage of their increased access to affordable health insurance remains in doubt.

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