Although a slew of political controversy succeeded in distracting our attention for about five minutes, I think we’re all getting used to idea that the health care system as we know it is changing. When we think about reform, let’s keep two things in mind: currently, the United States spends more than twice as much as any other country in the world on health care; and, despite our huge investment, our national health status is near the bottom of the developed world.
We hear political candidates sparring about a “repeal of health care reform”, but most experts think it unlikely. Analysts and industry specialists assert health care reform will continue out of necessity, whether through the Affordable Care Act or the momentum it already has created since being passed over two years ago. Many think it’s time to stop talking about everything that is wrong with the ACA, and just go on about it. The odds of repeal? Slim. According to a Kaiser Health Tracking Poll released recently, only about 20% of U.S. voters are pushing for a full repeal.
In large part, health care reform boils down to several points:
· If you don't have health coverage in 2014, you will have to pay a penalty. The fee is capped at $285 per family, or 1% of income, whichever is greater; $2,085 per family, or 2.5% of income, by 2016. Individual penalties will be $95 in 2014; $625 in 2016.
· Employers must provide coverage for adult dependents of workers up to age 26; health plans must cover basic preventive services without charging a deductible, co-pay or coinsurance; insurers can't impose a maximum annual or lifetime dollar limit on a customer's medical care.
· Beginning in 2014, insurers can't drop an individual if they become sick and they cannot refuse coverage for a pre-existing condition.
· Industry experts predict that employers who offer insurance will be even more focused on controlling their health care costs, especially since the individual mandate is expected to add more people - including more high-risk individuals - to their plans. Expect increases in premiums and deductibles.
· Consumers with incomes between 139% and 400% of poverty will be eligible for tax credits to offset the cost of buying coverage through exchanges. According to the Congressional Budget Office, the average subsidy per enrollee in the exchange will be $4,780 in 2014; $5,780 by 2018.
Medicaid is expected to include more low-income Americans – those earning up to 133% of the poverty level are eligible – with the federal government paying 100% initially and decreasing to 90% over the long term. But individual states are given the choice of expanding their Medicaid program. Currently, 22% of the Medicaid program is paid by the individual state.
Certainly one question looms large… Who pays? The answer is still murky. The government? Taxpayers? Will free enterprise take over and drive costs down? Although some analysts say the middle class will be hit the hardest, repeal at this point would add $109 billion to the deficit.
This we do know… The federal government will shift health care cost increases to governors and states, as 160 million Americans—or one out of every two—will be receiving their health care directly from the state or through a state created and operated exchange. This includes state employees, the 80 million individuals expected to purchase healthcare through the exchanges, and an additional 75 million on Medicaid.
Wonder what Rick Perry is thinking right now…