Health Insurance Reform Facts: How Virginia Insurance Agents Lower Health Costs & Track Compliance
Healthcare industry professionals and political pundits are early in the process of assessing the intended and unintended consequences of healthcare reform. One thing is certain: The Patient Protection and Affordable Care Act will radically change the landscape of healthcare in the United States. Somewhat ironically, the reform bill doesn’t directly address affordability. Most provisions focus on access to care and health insurance market reforms rather than underlying cost structures. When do the provisions take effect? Although many of the provisions have been touted as “effective immediately”, the earliest any of the regulations become effective is September 22, 2010, or the first health insurance plan year on or after September 22, 2010. In essence, insurance companies and employers are given six months from the effective date of the law to make the changes. These generally will be effective October 1, 2010 at the earliest, and September 1, 2011 at the latest. Among the changes effective in this early stage are:
- Preexisting condition limitations for children are eliminated.
- Insured parents can cover their children to age 26, regardless of student status.
- Insurance plans will be banned from imposing lifetime caps on coverage.
- Temporary high-risk pools for adults with preexisting conditions can be established.
- Healthcare coverage discrimination based on salary will be outlawed. Higher-wage employees (read: management) may no longer be insured under a separate plan.
- Employers with fewer than 25 employees meeting certain criteria will be eligible for significant tax credits of up to 35% of the cost of providing coverage.
- Private health plans will be required to offer preventive care services free to insured employees with no co-pays and no deductibles.
- Provisions are included that help close the “donut hole” for Medicare Part D.
The more global and far-reaching provisions become effective in 2014:
- Individuals must have coverage or are subject to a tax penalty.
- Health Plans must not discriminate against any provider acting within the scope of his or her license. It appears this will have broad impact on the nature and financial structure of networks.
- Employers will have to either pay-or-play. This involves complex rules that will impose fines and taxes on employers not providing coverage to employees.
- Certain low-income employees who opt out of employer sponsored coverage must be provided with “free-choice” vouchers by the employer.