CAPITOL HILL REPORT

Health Bill Seen Yielding Swift Results And Avoiding Worsening Crisis

By Congressman Bill Delahunt

Over the past year, health insurance reform has dominated the agenda here in Washington, and culminated with the signing of a landmark law that not only curbs widespread abuses in the health insurance industry but expands access to affordable healthcare.

The health insurance crisis facing our nation was serious. The high costs of insurance policies have been bankrupting families and threatening the budgets of government at every level. Not to mention an estimated 45,000 deaths annually of people unable to obtain proper care because they did not have health insurance.

We simply could not afford to pass up this opportunity to address this dire situation that healthcare experts warned would only get worse.

 The health insurance reforms just enacted into law will end some of the worst industry abuses, help control costs and reduce our deficit.

In fact, the Congressional Budget Office estimates the law will yield a net reduction in federal deficits of $118 billion over the 2010–2019 period. In the second 10 years, it is estimated the bill will reduce the deficit by between $650 billion and $1.3 trillion.

Some provisions of the bill will begin to take effect in the short term. I have summarized some of the key points below:

• In 2010, small businesses that choose to offer coverage will begin to receive tax credits of up to 35 percent of premiums to help make employee coverage more affordable;
• In 2010, adults who are uninsured because of pre-existing conditions will have access to affordable insurance through a temporary high-risk pool;
• This law will start to close the Medicare Part D donut hole in 2010 by providing a $250 rebate to Medicare beneficiaries who hit the gap in prescription drug coverage. Beginning in 2011, it institutes a 50 percent discount on prescription drugs in the donut hole and closes the gap by 2020;
• Starting this year, new private plans will be required to provide free preventive care: no co-payments and no deductibles for preventive services. Next year Medicare will do the same
• In 2010, it will provide help for early retirees by creating a temporary re-insurance program to help offset the costs of expensive premiums for employers and retirees age 55-64;
• This year, new healthcare plans and select grandfathered plans will allow young people to remain on their parents' insurance policy until their 26th birthday;
• Insurance companies will be banned from canceling coverage when policyholders get sick, and also from implementing lifetime caps; this year, restrictive annual limits on coverage will be banned for new plans and grandfathered group health plans;
• Beginning in the next fiscal year, the bill increases funding so that nearly double the number of patients can be treated in their community health centers over the next five years
• Beginning this year, it creates a new, independent appeals process that ensures consumers in new private plans have access to an effective avenue to seek redress of decisions made by their insurer;
• Starting January 1, insurers in the individual and small group market will be required to spend 80 percent of their premium dollars on medical services. Insurers in the large group market will be required to spend 85 percent of their premium dollars on medical services. Insurers who don't meet those thresholds will be required to provide rebates to their policyholders.
• It will hold insurance companies accountable for any future rate hike that is deemed excessive. Starting in 2011, states can require insurance companies to submit justification for all requested premium increases. Any company with excessive or unjustified premium increases may not be able to participate in the new health insurance exchanges;
• Finally, beginning this fiscal year, it will provide funding to states to help establish offices of health insurance consumer assistance to help individuals filing complaints or appeals against insurance companies.

This legislation is not perfect, but it brings us many steps closer toward providing affordable, quality, and stable health coverage and care for all Americans.