Health care legislation 101A look at health care legislation taking shape in the Democratic-controlled House and Senate as President Barack Obama pushes to overhaul the system, cover nearly 50 million uninsured Americans and contain rising costs. Many of the details are still being negotiated and any final health care bill would have to meld proposals from the House and Senate.
By: Associated Press,
A look at health care legislation taking shape in the Democratic-controlled House and Senate as President Barack Obama pushes to overhaul the system, cover nearly 50 million uninsured Americans and contain rising costs. Many of the details are still being negotiated and any final health care bill would have to meld proposals from the House and Senate.
The House Democratic bill:
WHO’S COVERED: Around 94 percent of non-elderly residents (those not covered by Medicare, which kicks in at age 65) would be covered — compared with 81 percent today. Nearly half the 17 million non-elderly residents who remain uninsured would be illegal immigrants.
COST: About $1.5 trillion over 10 years, although fiscally conservative Democrats claimed to have reduced the cost by about $100 billion as part of a deal House leaders agreed to Wednesday to win their votes on the Energy and Commerce Committee.
HOW IT’S PAID FOR: Revenue-raisers include $544 billion over the next decade from new income taxes on single people making more than $280,000 a year and couples making more than $350,000; $37 billion in business tax increases; about $500 billion in cuts to Medicare and Medicaid; about $200 billion from penalties paid by individuals and employers who don’t obtain coverage.
REQUIREMENTS FOR INDIVIDUALS: Individuals must have insurance, enforced through tax penalty with hardship waivers. The penalty is 2.5 percent of income.
REQUIREMENTS FOR EMPLOYERS: Employers must provide insurance to their employees or pay a penalty of 8 percent of payroll. Companies with payroll under $250,000 annually are exempt. That level could rise to $500,000 under the deal between House leaders and fiscal conservatives.
Employers could apply for a two-year exemption from the mandate if they can prove the requirements would result in job losses that would negatively affect their communities.
SUBSIDIES: Individuals and families with annual income up to 400 percent of poverty level ($88,000 for a family of four) would get sliding-scale subsidies to help them buy coverage. The subsidies would begin in 2013.
HOW YOU CHOOSE YOUR HEALTH INSURANCE: Through a new Health Insurance Exchange open to individuals and, initially, small employers; it could be expanded to large employers over time. States could opt to operate their own exchanges in place of the national exchange if they follow federal rules.
BENEFIT PACKAGE: A committee would recommend an “essential benefits package” including preventive services, mental health services, oral heath and vision for children; out-of pocket costs would be capped. The new benefit package would be the basic benefit package offered in the exchange and over time would become the minimum quality standard for employer plans. Insurers wouldn’t be able to deny coverage based on pre-existing conditions.
GOVERNMENT-RUN PLAN: A new public plan available through the insurance exchanges would be set up and run by the secretary of Health and Human Services. Democrats originally designed the plan to pay Medicare rates plus 5 percent to doctors, but under Wednesday’s deal with the fiscal conservatives the HHS secretary would instead negotiate rates with providers.
CHANGES TO MEDICAID: The federal-state insurance program for the poor would be expanded starting in 2013 to cover all non-elderly individuals with incomes up to 133 percent of the federal poverty level ($14,404).
The Senate Health, Education, Labor and Pensions Committee’s bill:
WHO’S COVERED: Aims to cover 97 percent of Americans.
COST: About $615 billion over 10 years, but it’s only one piece of a larger Senate bill.
HOW IT’S PAID FOR: Another panel — the Senate Finance Committee — is responsible for figuring out how to cover costs.
REQUIREMENTS FOR INDIVIDUALS: Individuals will have to have insurance, enforced through tax penalty with hardship waivers.
REQUIREMENTS FOR EMPLOYERS: Employers who don’t offer coverage will pay a penalty of $750 a year for each full-time worker. Businesses with 25 or fewer workers are exempt.
SUBSIDIES: Available up to 400 percent poverty level, or $88,000 for a family of four.
BENEFITS PACKAGE: Health plans must offer a package of essential benefits recommended by a new Medical Advisory Council. No denial of coverage based on pre-existing conditions.
GOVERNMENT-RUN PLAN: A robust new public plan to compete with private insurers. The plan would be run by the government but would pay doctors and hospitals based on what private insurers now pay.
HOW YOU CHOOSE YOUR HEALTH INSURANCE: Individuals and small businesses could purchase insurance through state-based purchasing pools called American Health Benefit Gateways.
OTHER PROVISIONS: Creates a new voluntary insurance program that would provide a modest daily cash benefit to help disabled people stay in their own homes instead of going into nursing homes.
A plan under discussion by a bipartisan group of six senators on the Finance Committee:
WHO’S COVERED: Around 97 percent of Americans. Illegal immigrants would not receive coverage.
COST: Around $1 trillion over 10 years.
HOW’S IT PAID FOR: Possible sources include cuts to Medicare and Medicaid; a tax as high as 35 percent on very high cost health insurance policies; a requirement for employers to pay into the Treasury for their employees who get their insurance through public programs or receive government subsidies to help pay premiums. Looking to raise $90 billion by taxing health insurance companies as much as 35 percent on policies valued at $25,000 or more.
REQUIREMENTS FOR INDIVIDUALS: Expected to include a requirement for individuals to get coverage.
REQUIREMENTS FOR EMPLOYERS: In lieu of requiring employers to provide coverage, lawmakers are considering a “free rider” penalty based on how much the government ends up paying for workers’ coverage.
SUBSIDIES: No higher than 300 percent of the federal poverty level ($66,150 for a family of four).
BENEFIT PACKAGE: The government doesn’t mandate benefits but sets four benefit categories — ranging from coverage of around 65 percent of medical costs to about 90 percent — and insurers would be required to offer coverage in at least two categories. No denial of coverage based on pre-existing conditions.
GOVERNMENT-RUN PLAN: Unlike the other proposals the Finance Committee’s will likely be bipartisan. With Republicans opposed to a government-run plan, the committee is looking at a compromise that would instead create nonprofit member-owned co-ops to compete with private insurers.
HOW YOU CHOOSE YOUR HEALTH INSURANCE: State-based exchanges.
CHANGES TO MEDICAID: Everyone at 100 percent of poverty would be eligible. Between 100 and 133 percent, states or individuals have the choice between coverage under Medicaid or a 100 percent subsidy in the exchange. The expansion would be delayed until 2013, a late change to save money — the start date had been 2011.
The House Republican proposal:
WHO’S COVERED: The House GOP’s plan, in outline form for now, says it aims to make insurance affordable and accessible to all. There aren’t estimates about how many additional people would be covered.
HOW’S IT PAID FOR: No new taxes are proposed, but Republicans say they want to reduce Medicare and Medicaid fraud.
REQUIREMENTS FOR INDIVIDUALS: No mandates.
REQUIREMENTS FOR EMPLOYERS: No mandates; small business tax credits are offered. Employers are encouraged to move to “opt-out” rather than “opt-in” rules for offering health coverage.
SUBSIDIES: Tax credits are offered to “low- and modest-income” Americans. People who aren’t covered through their employers but buy their own insurance are allowed to take a tax deduction. Low-income retirees younger than 65 (the eligibility age for Medicare) would be offered assistance.
BENEFIT PACKAGE: Insurers would have to allow children to stay on their parents’ plan through age 25.
GOVERNMENT-RUN PLAN: No public plan.
HOW YOU CHOOSE YOUR HEALTH INSURANCE: No new purchasing exchange or marketplace is proposed. Health savings accounts and flexible spending plans would be strengthened.
CHANGES TO MEDICAID: People eligible for Medicaid would be allowed to use the value of their benefit to purchase a private plan.
Obama’s campaign proposal:
WHO’S COVERED: All children and many now-uninsured adults.
COST: Estimates as high as $1.6 trillion over 10 years.
HOW’S IT PAID FOR: Obama proposed cuts within the health care system and raising taxes on households making more than $250,000 annually.
REQUIREMENTS FOR INDIVIDUALS: Unlike his Democratic primary opponent Hillary Rodham Clinton, Obama did not propose an “individual mandate.” Instead he would have required all children to be insured, making it the parents’ responsibility.
REQUIREMENTS FOR EMPLOYERS: Large employers would have been required to cover their employees or contribute to the costs of a new government-run plan.
SUBSIDIES: Obama proposed giving subsidies to low-income people but didn’t detail at what level.
BENEFIT PACKAGE: Insurers participating in a new health exchange would have had to offer packages at least as generous as a new public plan. All insurers would have been prohibited from denying coverage based on pre-existing conditions and would have had to cover children through age 25 on family plans.
GOVERNMENT-RUN PLAN: A new public plan would have offered comprehensive insurance similar to that available to federal employees.
HOW YOU CHOOSE YOUR HEALTH INSURANCE: Through a new National Health Insurance Exchange where individuals could buy the new public plan or qualified private plans.
CHANGES TO MEDICAID: Would have expanded Medicaid eligibility, but didn’t specify income levels.