Blogs » A Constitutionalist & Believer in Natural Law » The Patient Protection and Affordable Care Act-Summary

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All Americans I contend desire to understand the recently passed health care reform act. We desire this knowledge so we can know what to expect in the future, will the bill help me and my family, will the bill reduce my insurance premiums, and will I get free insurance? How will I be protected and afford healthcare?

After a lot of research, I believe I have got somewhat a handle on what we can expect from the recently passed Health care bill. I am not perfect, so I may have some facts wrong, when possible I offer bill sections as references.

THIS YEAR

  1. Insurance companies will be barred from dropping people from coverage when they get sick. Lifetime coverage limits will be eliminated and annual limits are to be restricted. There is nothing that suggests that premiums will not increase or co-payments increase to cover the extra cost.

  2. Young adults will be able to stay on their parents' health plans until the age of 26. Many health plans currently drop dependents from coverage when they turn 19 or finish college.

  3. Uninsured adults with a pre-existing condition will be able to obtain health coverage through a new program that will expire once new insurance exchanges begin operating in 2014.

  4. A temporary reinsurance program is created to help companies maintain health coverage for early retirees between the ages of 55 and 64. This also expires in 2014.

  5. Medicare drug beneficiaries who fall into the "doughnut hole" coverage gap will get a $250 rebate in 2010. The bill eventually closes that gap which currently begins after $2,700 is spent on drugs and restarts after $6,154 is spent.

  6. A tax credit becomes available for some small businesses to help provide health insurance coverage for workers. Credit is only available to profitable small businesses with taxes that met or exceed the credit.

  7. Section 10907 of the Original Bill - Excise tax on indoor tanning services. A 10 percent tax on indoor tanning services that use ultraviolet lamps goes into effect on July 1. Look for an expansion in spray on tans.

  8. A cap is imposed on insurance company non-medical, administrative expenditures. A nice way to say the federal government caps wages.

IN 2011 1. Medicare beneficiaries will be able to get a free annual wellness visit and personalized prevention plan service (assuming physician accepts Medicare assignment). New health plans will be required to cover preventive services with little or no cost to patients (causing increases in premiums to cover this cost).

  1. A new program under the Medicaid plan for the poor goes into effect in October that allows states to offer home and community based care for the disabled that might otherwise require institutional care.

  2. Payments to insurers offering Medicare Advantage services are frozen at 2010 levels. These payments are to be gradually reduced to bring them more in line with traditional Medicare (a plan to eliminate the Medicare Advantage services by 2018).

  3. Employers are required to disclose the value of health benefits on employees' W-2 tax forms.

  4. Section 1404 of the Amendment – Brand name pharmaceuticals: An annual excise tax will be imposed on pharmaceutical companies according to their market share. The total fees in 2011 will be $2.5 Billion dollars and will have annual increases to $4.8 Billion in 2018. The fee does not apply to companies with sales of $5 million or less. No cost reduction here for the main street. This can only result in the tax being passed on to patients, so our cost of medicines will increase.

IN 2012 1. Physician payment reforms are implemented in Medicare to enhance primary care services and encourage doctors to form "accountable care organizations" to improve quality and efficiency of care.

  1. An incentive program is established in Medicare for acute care hospitals to improve quality outcomes. This program will encourage hospitals to eliminate Medicare assignment.

  2. The Centers for Medicare and Medicaid Services, which oversees the government programs, begin tracking hospital readmission rates and puts in place financial incentives to reduce preventable readmissions.

IN 2013 1. A national pilot program is established for Medicare on payment bundling to encourage doctors, hospitals and other care providers to better coordinate patient care.

  1. Section 9013 of the Original Bill - Modification of itemized deduction for medical expenses: The threshold for claiming medical expenses on itemized tax returns is raised to 10 percent from 7.5 percent of income. The threshold remains at 7.5 percent for the elderly (over 65) through 2016. Looks like a tax increase on people making less than $200,000 to me.

  2. Section 1402 of the Amendment – Medicare tax. The Medicare payroll tax is raised to 2.35 percent from 1.45 percent for individuals with incomes of more than $200,000 and married couples with incomes over $250,000. The tax is imposed on some investment income for that income group. This creates a marriage penalty. For example, if both husband and wife make $150,000 they will have to pay the penalty on $50,000. If they were single there would not be a penalty tax.

  3. Section 1405 of the Amendment – Excise tax on medical device manufacturers. A 2.9 percent excise tax in imposed on the sale of medical devices. The medical device excise tax would apply to products ranging from surgical instruments to bedpans. Anything GENERALLY purchased at the retail level by the public is excluded from the tax. We can expect to see a major turn down in research and development (R&D) for new devices, and major job cuts and rollbacks on expansion plans. Many companies will move operations to foreign countries to reduce production cost.

IN 2014 1. State health insurance exchanges for small businesses and individuals open; the alternative wording for “public option”. Nothing suggests that the exchange insurance will not require co-payments, annual deductions, or the acceptance of assignment by physicians and hospitals.

  1. The bill made a radical change related to Medicaid. Medicaid currently covers poor children, disabled adults, aged adults, and pregnant women. Under the bill all grown adults will be covered even if they are childless as long as their family annual income is less than $29,000 and singles annual income is less than $16,400. It is estimated that it will be an almost 25% increase in the number insured in Texas. Legal immigrates will qualify. Many young adults, college students, and unemployed will qualify under the new rules, The federal government will pay the states 100 % of medical cost related to the expansion till 2016, after that they would revert to the 40-50% medical cost reimbursement. But the federal government will pay nothing for the cost to administer the plan. The state will be forced to increase revenues to pay for this new federal mandate.

  2. Section 1002 of the Amendment – Individual responsibility: Most people will be required to obtain health insurance coverage or pay a fine if they don't. The fine in will be $695 for failure to purchase health insurance. So individuals like the Hollywood elite will only need to pay a fine. Healthcare tax credits become available to help people with incomes up to 400 percent of poverty (less than $88, 200) to purchase coverage on the exchange.

  3. Health plans no longer can exclude people from coverage due to pre-existing conditions. There is nothing that suggests that premiums will not increase or co-payments increase to cover the extra cost.

  4. Section 1003 of the Amendment – Employer responsibility: Employers with 50 or more workers who do not offer coverage face a fine of $2,000 for each employee if any worker receives subsidized insurance on the exchange or receives Medicaid. The first 30 employees aren't counted for the fine. This will encourage employers to not hire single individuals or part time help that will be paid wages that would qualify them for government subsidized programs. It will also, encourage employers to keep their work force to only 30 employees. Many companies will a chain of stores or outlets will be encouraged to break up into individual corporations. Also, expect a movement from hiring employee to contract labor when the laws permit. Employers that offer group insurance cannot charge the employee more than 60% the cost of the total premiums.

  5. Section 1406 of the Amendment – Health insurance providers. Health insurance companies begin paying an excise tax based on their market share. $8.0 billion annual excise tax. The excise tax increases to $11.3 billion annually for 2015, 2016, and 2017. The excise tax increases to $14.3 billion in 2018 and rises by inflation thereafter. The tax is assessed based on a companies market share and is non-deductible for federal tax purposes. If you believe this will not cause insurance premiums to rise, you don’t understand the goals of stockholders.

IN 2015 Medicare creates a physician payment program aimed at rewarding quality of care rather than volume of services.

IN 2018 1. Section 1401 of the Amendment – High cost plan excise tax: A 40 % excise tax on high cost employer-provided plans is imposed. The first $27,500 of a family plan and $10,200 for individual coverage is exempt from the tax. Higher levels are set for plans covering retirees and people in high-risk professions.

  1. Section 9015 of the Original Bill – Medicare tax: In addition to the expansion of Medicare tax on investment income as noted in Section 1402 above, the Medicare tax rate has also increased. This tax increases by a third, from 2.9 percent to 3.8 percent on investments when the combined income is over the $200,000 limit for an individual and $250,000 for a married couple. Once again we see a marriage penatly.

What I cannot find in the bill anything that prevents physicians and hospitals from refusing to accept the assignment of Medicare, Medicaid, Tricare, CAMPVA, or exchange insurance. I could not find any change that allows reimbursement for imported drugs or make it lawful to purchase drugs internationally.
So it is possible that we end-up with insurance no one will accept. But we will still have more taxes to pay for a bigger federal government, higher private sector insurance premiums, more out of pocket expenses, imported medical devices, old generation drugs, imported physicians, and poorly equipped hospitals and clinics. And there will be no Patient Protection and Affordable Care.