Efforts to change the delivery system of
Providers then would shift the cost (I.e. cost shifting) to those who could afford to pay out of pocket or who had insurance. Consequently, the well to do and insured Americans saw their costs of
Since the failure of the 1994 attempt at reform, the
Managed Care plans helped alleviate the cost shifting stress for a while, but failed to bring more uninsured folks into the system. Eventually, as the number of uninsureds rose, premiums were forced higher and higher until today where it is not unusual for a family premium to be more than a house payment.
Most estimates say 47 million Americans are without
By March 23, 2010, the result of reform provided only modest incentives for those 47 million to participate in cost sharing system. Rather, the result ended up as insurance reform.
On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (PPACA). On March 30, 2010, the President signed into the law the
The end result of reform will not reduce costs. The primary focus intended to get those 47 million Americans in the system as participating financial contributors by forcing them to purchase
The incentives to get more people into the system include:
-tax credits for businesses who offer and help pay for insurance
-penalties to individuals and families who do not buy insurance
-elimination of pre-existing
-premium subsidy payments to individuals and families who could not afford insurance
-expansion of Medicaid
These mandates along with a host of other mandates will be phased in over the next seven years, with the majority required by January 1, 2014. It is on this date that subsidies, penalties, and adult pre-existing condition limitations begin. Other prominent provisions begin on that date as well:
-State run “
-Policies may no longer include limitations on annual benefits
-Wellness programs begin
-Group plans will not be able to extend waiting periods for insurance eligibility beyond 90 days
-Employers must begin to “certify” coverage.
Other mandates require insurance companies to install important provisions by September 23, 2010:
-Dependent children, whether married or unmarried, student or non-student may remain as dependents until age 26
-Children under age 19 who have a pre-existing condition must be “guaranteed issue”
-Insurance companies may not rescind
-A $250 payment will be made to Medicare Part D (prescription drug plan) beneficiaries as the first installment toward closing the “donut hole” by 2020.
In the meantime prior to September 23, 2010, insurance companies will distribute updates to small group plan sponsors the following items:
The next article will focus on group insurance reforms with more detail about the effects on small
Source by John Claborn