When it comes to health administration, the health reform bill passed earlier this year is ushering in plenty of change. Indeed, the bill is being touted as the biggest overhaul to healthcare in the U.S. There are certainly are plenty of changes coming to healthcare, and there have been many attempts to explain healthcare reform, and what it means for the future of healthcare in the U.S.
Many, though, are more interested in what has already taken place. While many of the provisions in healthcare reform will not take place until 2014, there are already some items that have already taken effect. Some of the changes to healthcare reform may already be impacting your wallet. We are in the neighborhood of the six-month anniversary of the signing of the healthcare reform bill, and it is time to take stock. Health administration officials, as well as members of the general public, have it in their best interests to understand what is already in effect. Here are 10 health care reform items effective in 2010:
1. Adult Children Remain on Parents’ Policy Until 26
One of the provisions of the health care reform bill already in effect is that adult children can remain on their parents’ health policy until they are 26. Prior to the new law, states set their own ages for taking children off parental policies, usually sometime between 21 and 23. Now, if the dependent does not have the ability to get insurance through his or her own employer, it is possible to remain on the parents’ policy. This rule only applies to new policies, although health insurance companies have to provide coverage on existing policies (but it can be separate and might be expensive).
2. No More Lifetime Caps on Coverage
Starting in September 2010, insurance companies can no longer put lifetime caps on coverage. This means that insurance policies can no longer come with limits on lifetime payouts, many of which were capped at $1 million or $2 million prior to the passage of the law. For most people, the lift on caps is not a big deal, but for those with medical catastrophes, that limit comes up pretty fast. Starting in 2014, the annual caps that some companies put on coverage will be abolished as well.
3. Children Under 19 Cannot be Excluded for Pre-Existing Conditions
One of the biggest issues with health insurance coverage is the pre-existing condition. Starting this year, children with pre-existing conditions cannot be denied coverage. The rule is already in effect for those whose plan dates are October. The rule is in effect starting on the next plan date, so if your plan date is October 1, then your renewal will not exclude children under 19 due to a pre-existing condition. January 1 and July 1 plan dates will be phased in during 2011, and most of the population over 19 will be included in 2014.
4. Adults with Pre-Existing Conditions Have a New Option
If you have a pre-existing condition, and you are 19 or older, you can still be denied healthcare coverage until 2014, when many of the reform rules take effect. However, if you have a pre-existing condition and want coverage, you can buy into a health insurance plan offered by the government right now.
5. “Doughnut Hole” Closes
The infamous “doughnut hole” caused by Medicare legislation in 2003 has cost seniors quite a bit as they struggle to pay for their own medications after reaching a certain amount. There is a gap in prescription drug coverage until seniors have spent more money out of pocket. The new bill closes this gap in the future, and offers immediate assistance with paying for prescriptions right now.
6. Early Retirees Get Help
One of the issues facing early retirees is paying for health insurance now that they no longer have an employer’s plan — but are too young for Medicare. The healthcare reform bill provides help for those in this situation. Right now, it is possible for early retirees (aged 55 and older) to have access to health coverage until they qualify for Medicare. The program works by providing assistance to employers so that they can extend coverage to early retirees.
7. Free Preventative Healthcare
Much has been said about how the U.S. health care system is more about “sick care”, since prevention gets so little play. However, healthcare reform requires that new plans have to cover certain preventative services starting on September 23. Some of the covered services include cancer screening, cholesterol and diabetes tests, blood pressure checks, vaccines for a range of illnesses, well-child visits up to the age of 21, pap smears, and mammograms for those older than 40.
8. Funding for Community Health Centers
Early funding for some community health centers is provided for by the healthcare reform bill, starting in fiscal year 2010. Community health centers offer valuable services for some underserved members of rural and inner-city communities. Early funding is a great help for these communities, which are slated to receive an additional funds over the course of five years.
9. Small Businesses Get Special Tax Credit
For small businesses interested in providing healthcare coverage for their employees, there are special small business tax credits available starting in calendar year 2010. Tax credits of up to 35% of premiums paid are being offered right now for small businesses. In 2014, though, the tax credit increases. It is expected that small businesses will receive up to 50% in tax credits when more of the law’s provisions take effect. In order to get the 50%, though, employers will have to pay directly, rather than use an agreement that reduces salary.
10. No More Recissions
One of the practices that have many upset with health insurance companies is that of recission. Recission takes place when the health insurance company drops your coverage when you get sick, in order to avoid paying for your treatment. Effective six months after enactment, this rule bans health insurance companies from dropping you just because you get sick. It is a way to ensure that you continue to receive the coverage you have paid for.
Bonus: More Transparency
One of the more immediate provisions of the healthcare reform bill is that health insurance companies have to be more transparent. Insurers must post their balance sheets on the Internet, and disclose executive compensation, as well as other costs. There are hopes that such a requirement will put pressure on health insurance companies when it comes to setting premiums.