Health Care Reform is a general phrase used to discuss major health policy changes, usually governmental policies that affect the health care delivery system of a given place.
What is the purpose of Health Care Reform?
Health care reform is an attempt to decrease the total cost of healthcare while improving the quality of health care to the people. It is meant to increase the population of those who receive health care benefits and coverage through either public or private insurances. Attempts are made to improve access to specialists and to expand the choices of health care providers that patients may choose to see.
The year 2014 will see penalties assessed for many Americans who do not purchase health insurance. American Indians will not be required to purchase health insurance and people whose religion objects or who have financial hardship will also not be required to participate. Penalties will be phased in and will start at $95 or 1% of your income whichever is greater. This amount will rise to $695 or 2.5% of income by 2016. The maximum amount will not be greater than $2085.
What’s the Health Care Reform mean for those with private insurance policies?
In 2010 President Obama signed new health reform legislation into law that is geared to bring down health care costs for small businesses and American families. It is promised to expand coverage to millions of Americans beginning this year.
With the new health care reform, you as an individual can keep your current health plan or choose to purchase insurance through the new state managed insurance markets starting in 2014. The existing plans do not have to meet the higher benefit standards set by the new policies. The existing plans will face strict regulations. These existing plans that do not meet the new benefit standards are not able to add more policy holders or other benefits and within 6 months they are mandated to stop some of the practices they now enforce. Some of these practices include such things as setting annual limits on coverage provided and cancelling policies for people who become ill. Children will also be allowed to remain on parent’s insurance policies until the age of 26 and any policy that covers children cannot deny coverage for pre-existing medical conditions.
Beginning in 2013 high income families who make more than $250,000 will be paying several thousand dollars more in Medicare taxes. Unearned income which was previously exempt from Medicare payroll tax will be subject to a 3.8 percent tax levy.
In 2014, Insurance companies will no longer be able to deny coverage because of a person’s medical condition. They will not be able to charge higher rates due to a person’s sex or health status. Every new plan will be subjected to benefits defined by the federal government and new plans will have to offer a minimum package that meets these standards including no cost preventative services.
By the year 2016 it is estimated that the premiums for individual health care policies will increase by 10 to 13% higher than the average premium that year under current law. However most of these people would qualify for subsidies for which they might pay less than they are paying right now. Tax credits will be offered on a sliding scale to help pay insurance premiums and deductibles.
Exchanges that offer health plans can offer abortion coverage but their subscribers who get federal subsidies will have to pay separate premium payments for this coverage. States are able to ban abortion coverage.
What’s the Health Care Reform mean for insurance provided through employers?
Health care insurance policies provided through your employment will be required to meet the same standards as those through privately purchased insurance policies. In addition, starting in 2018 they will have to pay a 40 percent excise tax on high value group plans. High value groups plan for instance, would be those in which the premiums for a family are $27,500 or more. The health reform experts are predicting that this tax will most likely be passed to the employee resulting in either higher premiums or lower wages and benefits.
Flexible spending accounts will be limited. Flexible spending accounts are set up through your employer to help the insured avoid taxes on several medical expenses. The current maximum ranges between 4 to 5 thousand dollars annually, but this will be reduced to $2500 maximum. Using these accounts to purchase over the counter medications will no longer be allowed.
If your employer offers insurance, but covers less than 60% of the costs or you pay more than 9.5% of your earned income to purchase it you can buy subsidized coverage from the exchanges. You will be eligible to receive a voucher from your employer if your income is lower than $88,000 for a family of four and providing your premiums cost you 8 to 9.8% of your income to enable you to purchase insurance on the exchanges.
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