March 17, 6:18 PM Political Buzz Examiner Ryan Witt

By now the health care reform bill has become something like Bigfoot in that everyone talks about it but few know what it really looks like if it exists at all.  For clarification there is in fact a “bill” which is set to be voted on by the House of Representatives this weekend.  The current bill was already passed by the Senate and has been analyzed extensively by experts. However in addition to the Senate bill the House also plans to vote on a “fix” to the bill which will then go back to the Senate.  The “fix” is not all together settled and is still being written after going through markup in the House Budget Committee (picture on left).

Still the fixes are relatively small because they must be in order to be passed through the reconciliation process in the Senate.  We therefore know most everything that the bill would do if it is passed this weekend.  Here is a plain language summary of the major provisions of the health care reform bill.

Would I Be Forced to Purchase Insurance?

Probably not.  If you already have employer-provided insurance you can keep it.  If you do not currently have any insurance you may have to purchase a plan by 2014.  Beginning in 2014 most Americans would have to purchase health care insurance or be forced to pay a fine.  If someone already has insurance (including through their employer) they would not need to worry about this provision.  For those who would be affected they could purchase insurance from anywhere but if they do not they would need to pay either $750 or 2% of their income, whichever is greater.  Exemptions would be granted for those in financial hardship which is measured using the poverty line.

Would My Current Insurance Be Affected?

Yes and no.  Yes in that any new plans would be regulated by the federal government.  The regulation would make plans provide a minimum of amount of benefits but not a maximum.  It would also implement consumer protections and an appeals process for consumers who want to dispute the decisions of their insurance companies on individual coverage.  The Congressional Budget Office estimates that premiums would go down under reform compared to the rate premiums would go up without reform.

Having said all that the reform plan “grandfathers” plans already in existence.  Therefore a plan currently in existence would be exempt to any changes at least for a while under the current bill.

What About This Exchange Idea and the Public Option?

There is no public option or new government provided insurance plan under the current bill.  Instead each state would have a health care insurance exchange where any individual can purchase health insurance.  The insurance plans in the exchange would have to meet federal regulation that would ensure they provide minimum benefits, etc.  Individuals who are currently covered by an employer-provided plan could not purchase form the exchange.  Undocumented immigrants could also not purchase from the plan. 

All plans in the exchange would be regulated by the federal government.  These regulations would include requirements that the plans provide a certain minimum level of coverage, that they do not discriminate based on pre-existing exclusions, that they spend a high percentage of their premiums on actual care (around 80%), and that they follow certain consumer protection laws.  In addition plans could no longer limit how much costs they are willing to cover.  In the past insurance companies would be able to limit their liability to $250,000 for example and stop paying once that limit was reached.

What Would Happen to Medicare?

The proposal would set up a board that would research and propose solution to reduce the costs of Medicare.  The board would be specifically prohibited from proposing anything which would amount to rationing care for the elderly.  Instead the proposal would focus on reducing waste and fraud while making Medicare more efficient.

What if I Can Not Afford Health Insurance?

Individuals who make between 100%-400% above the federal poverty level would be eligible to receive credits to assist them in purchasing health care insurance.  The amount of credit would generally go down the more income an individual made.  For the poorest the credit may pay for all of their health care premiums.

Would Employers Be Forced to Provide Insurance?

Maybe.  If a business has over 50 full-time employees they will be forced to offer health care coverage or face a $750 fee per employee.  Businesses with less than 50 employees would be exempted from providing coverage.

What About Medicaid?

Medicaid would be expanded to cover all individuals under the age of 65 who make less than 133% of the federal poverty level.  Currently the poverty level is around $18,000 for a family of three.

Does the Bill Pay for Abortions?

The bill keeps the current federal law on abortion funding in that federal funds could not be used directly to pay for abortion or abortion-related services.  The current bill does not include the abortion language in the House bill which put restriction on funding which were even more strict than the current law.  Essentially the House bill would have prevented individual receiving federal assistance from purchasing any health care plan (private or not) that provided abortion coverage.

What About Small Businesses?

Initially small businesses would receive a tax credit for up to 35% of the money they pay to purchase health insurance for their employees.  By 2014 that percentage would increase to 50%.  The idea is to help small businesses pay for health insurance coverage since they currently do not have the bargaining power of larger businesses.

Small businesses would be allowed to join forces in order to purchase insurance for their employees.  In other words five small businesses could all negotiate with an insurance company together in order to get a lower rate as big businesses currently do.

How is It All Paid For?

First there is a cadillac plan tax.  If an insurance plan costs $8,500 for an individual or $23,000 for family it would be taxed at 40% for any amount above those amounts.  Most health care plans cost much less than those amounts in premiums.

Secondly there are taxes on health insurance companies, pharmaceuticals, and medical supply companies.  Each of these companies would be assessed fees.  Pharmaceuticals would pay $2 billion, medical supply companies would pay $2.3 billion, and health insurance companies would pay $2 billion starting in 2011 and increasing to $10 billion by 2017.

Finally the bill would count on increased efficiency and reduced waste in Medicare to offset some of the other costs.  Overall the bill was projected to save a little over $100 billion in the first ten years of its existence and well over $700 billion after that.  Those projections were done by the non-partisan Congressional Budget Office.