Heath Care Reform: What You Need To Know

The issue of health care has become much more complex since the signing in of Heath Care Reform by President Obama passed just last month. However, just because things look complex doesn't mean that you have to get lost in the sea of opinions that float around the new health care reform act. This hub is meant to inform you on the facts of health care. It is not here to debate the pros or cons of it.

All the provisions in the health care bill won't take place immediately. In fact, it will take until 2018 to be in full effect. Most of the changes to the health care system will occur on January 1^st 2014, with more key provisions scattered both before and after that time. The first of the provisions start almost immediately, beginning with this list of changes:

Starting Immediately:

1) The Medicaid drug rebate is increased to 23.1%.

2) The Indian Health Care Improvement Act is reauthorized and amended.

Starting September 23 2010:

1) Children may stay on their parents health care plan until they are 26.

2) Indoor tanning places are subject to a 10% tax on all services.

3) Insurers are banned from dropping coverage when a policyholder gets sick.

4) Insurers will be restricted in setting spending limits on policyholders.

5) People affected by the "Doughnut Hole" (Medicare Part D) coverage gap will be compensated with a $250 rebate.

6) Medicare will be expanded to rural hospitals and other facilities.

Starting January 1 2011:

1) Insurers will be required by law to spend 85% of large group and 80% small group premiums on health care or it's quality. If insurers do neither, they will then be required to send it back to the policy holder as a rebate.

Starting 2012:

1) Physician payment reforms are put into effect, which essentially allows a physician to be payed more for the quality of work instead of the hours that they work.

2) An incentive program wil be put into effect at hospitals to improve care.

Starting 2013:

1) A 2.9% excise tax is placed on the sale of medical devices.

2) A Medicare payroll tax of 2.35% (from 1.45%) is placed on individuals earning more than $200,000. For families, the cutoff is at $250,000.

Here is where the chaos begins. The Patient Protection and Affordable Care Act becomes effective January 1 2014, and contains most of the health care legislation.The public option will also start at this time.

Starting January 1 2014:

1) Insurers are banned from denying health coverage based on pre-existing medical conditions.

2) Insurers are banned from putting spending caps on policyholders

3) Medicaid will expand to cover families and individuals up to 133% above the poverty line.

4) Those who do not secure insurance will be fined $695 if you are an individual. The fine is $2085 for a family.

5) Chain restaurants will be required to show the caloric content of their food.

6) Impose a $2000 fine (per employee) on employers with more than 50 employees who do not provide insurance for those employees.

7) For employers with less than 25 employees, a tax credit will be given if they provide health benefits for their employees.

8) A public option will go into effect: anyone who is making an income that is 400% or below the federal poverty line may purchase insurance with decreased premiums. This subsidy will be provided as a refundable tax credit. (This is perhaps the most complex part of the health care reform. For more info, you may want to look at the government website)

9) A new excise tax will be put on pharmaceutical companies that is estimated to create close to 2.5 billion in revenue.

Starting 2015:

1) Health Practitioners will be payed on their quality of care. This system will be implemented via. Medicare.

2018 is when the last of the health care legislation will be implemented.

Starting 2018:

1) All existing health care plans must cover preventive care and check-ups without co-payments.

2) A 40% excise tax will be introduced on "Cadillac" plans.

Many people wonder if health care reform is really necessary. Here are a few statistics from the White House itself. Again, it is up to you to decide if you think it is good or not.

Estimated Cost: $940 billion

Estimated Savings (Over 10 years): $143 billion

Estimated Savings from Social Security: $53 billion

Estimated Savings from Collected Premiums: $70 billion

Amount of people uninsured who will receive insurance under the bill: 32 million

Whether you think that the health care bill is good or bad, we cannot deny that things are about to change. There is still a lot more to learn if you are interested. Visit a few of the following links if you have any more questions about this subject.