April 1, 2010
Separating Fact from Fiction in the New Health Care Reform Law
Now that the health care reform bill is law, Americans are beginning to sift through the facts and myths, reality and fiction. People's focus is naturally turning toward learning what is in the law and what it means for them and their families.
Here is what goes into effect this year:
Small businesses will get a tax credit on thirty-five percent of the cost of health insurance for their employees. Many small businesses want to extend coverage to their employees but can't because of the cost. For the small businesses already providing health care coverage for workers, they will also benefit from this tax break. While businesses with fewer than 50 employees aren't obligated to provide insurance, these credits might encourage employers to do so. This will not only make health care coverage more affordable but it will allow small business owners to invest these savings back into their businesses.
Under the Medicare Prescription Drug plan, seniors must pay the full cost of drugs once they reach the coverage limit of $2,250, known as the "doughnut hole." The new reform law gives seniors a rebate of $250 for their Medicare prescription drug coverage if they fall in the "doughnut hole," which will eventually be phased out completely.
Young people get to stay on their parents' plan until they are 26 years old, which will mean a lot to parents and young adults as we approach graduation season.
We've all heard the moving stories of those who were denied health care insurance for having a pre-existing condition. Adults with pre-existing conditions get to choose insurance as members of a temporary high-risk pool until 2014 when they can sign up for any insurance plan.
Here is what goes into effect next year and over time:
While the insurance mandate lets Americans pool together to encourage affordable rates, many Americans could find the mandate to be a financial burden. So the reform law provides families earning between $22,000 and $88,000 a year with sliding federal subsidies to help them afford insurance.
No more copayments for preventive services like check-ups and cancer tests. Preventative heath care means healthier people and savings down the road.
Health insurance exchanges will be up and running in three years so Americans can evaluate competing insurance plans and choose one that suits them best – sort of like choosing the best travel deal on Expedia or Orbitz.
This is not in the new law:
During the debate on health care reform, many myths overshadowed the truth. Two of the myths rank right up there with the irresponsible and ridiculous "death panels" charge.
A few people have been making the charge that Tricare, a health care plan for service members and military retirees, will be moved out of the Department of Defense and into another agency. This is absolutely false, and it is reckless to cause our military personnel and retirees to worry unnecessarily. The Secretary of Defense clearly stated that this reform will not negatively impact the Tricare program, and the Obama Administration says it has no intention of moving Tricare from the Department of Defense. Any effort to move Tricare would have to go through the Military Personnel Subcommittee, of which I am the Chairwoman, and I would certainly oppose such an effort.
No one is going to jail for not paying the fee if they don't have health insurance. Since the new law requires everyone to participate by either buying health insurance or paying a fee, individuals who don't get insurance through their employer, or Medicaid/Medi-Cal or Medicare, or who are not on someone else's health care plan, would face a fee if they don't purchase insurance on their own. However, the new law clearly states that failure to pay will not lead to any "criminal prosecution or penalty."
Good health is one of the most important things a person can have—there is truth in the saying that it is more valuable than all the riches in the world. The new law passed isn't just about reducing sky-rocketing premiums or putting patients ahead of insurance companies—it's about containing the total cost for families and giving people greater empowerment when it comes to their health care needs.