We hope you had a healthy and profitable Memorial Day.
The basic idea of health care reform is to lower costs. Health care reform does this is several ways.
- First, because people without health insurance drive up the cost of insurance just like shoplifters drive up the cost of goods, health care reform is massively expanding the pool of those with health insurance. Medicaid expansion, the personal responsibility mandate, coverage of young adults on their parents plan and coverage of those with pre-existing conditions are the major ways health care reform expands coverage. Health care reform also provides tax credits for small businesses and subsidies to low and moderate income people to help them buy health insurance.
- Second, health care reform puts new limits on health insurance companies. Health insurance companies are now required to spend at least 80% of the money they collect in premiums on actually health care or rebate money to their customers.
- Third, health care reform provides new ways to buy private health insurance. The new Health Insurance Marketplace (formerly called a Health Benefits Exchange) allows small business and individuals to enjoy group buying power when they buy health insurance.
- Fourth, health care reform provides better information. Insurance information will now be easier to understand and the new Health Insurance Marketplace groups health insurance plans into platinum, gold, silver and bronze categories to ease shopping and make “apples to apples” comparisons of plans doable.
- Fifth, health care reform uses a “community rating” method to set health insurance rates that shares health expenses more evenly over the entire population.
- Finally, health care reform stress efficiencies in the health care delivery system to achieve long term cost savings. Wellness and prevention benefits are now stressed. The government is looking at better ways to pay for health care to encourage long term health. And the government is funding pilot projects and research to find better ways to provide health care.
Some of these proposals have already been implemented but most will take effect January 1 of 2014.
Healthcare.gov is a great source for additional information about health care reform.
The Virginia Health Reform Initiative, the task force the governor appointed to oversee health care reform, will meet on Wednesday, June 12, from 1:00-4:00 p.m. in House Room D of the General Assembly Building in downtown Richmond. The Medicaid Innovation and Reform Commission, which will decide on Medicaid expansion in Virginia, will meet on Monday, June 17 at 1 p.m., General Assembly Building, House Room D.
Health care reform requires all employers to provide a notice about health care reform to their employees by October 1, 2013. Two draft notices (one if you offer insurance, one if you don't) are available at: http://www.dol.gov/ebsa/healthreform/.
As we move towards the start up of the new Health Insurance Marketplace (Health Benefits Exchange), states are starting to announce preliminary costs figure for health insurance. California just announced its numbers last week and they were remarkably affordable. A bronze level plan will be available for $172 a month before subsidies. Silver level plans are not much more expensive. California is not only the largest health insurance market in the country but it also the state that has done the most to fully implement health care reform.
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