Monday, March 22, 2010


Just so you know, these are not my words, but this is a decent summary of the Health Care Reform I found.

The House of Representatives passed the healthcare reform bill last night. It'll make the most significant changes to America's health care system in more than 40 years. Depending on how you see things, it's a historic moment . . . or a historic mistake.

--Here are the four major points you need to know.

#1.) It gives health insurance to 32 million Americans who don't have it. That number mostly includes people living near or below the poverty line, and also people who've been denied insurance because of pre-existing conditions.

#2.) The insurance companies hate it. Starting in 2014, the bill PREVENTS insurance companies from putting a cap on how much they'll cover . . . REQUIRES them to cover "riskier" clients like people with pre-existing conditions . . . AND taxes them on the high-end insurance packages they offer to "safer" clients.

#3.) It'll cost $940 billion over the next 10 years. But it's also expected to make the federal deficit go DOWN. That's because the bill cuts some government spending and creates new taxes to cover the cost.

--Medicare will be funded by a tax on families that make more than $250,000 a year from their investments. Insurance companies will also get hit with a 40% tax on the high-end insurance plans they offer to their best . . . and usually wealthiest . . . clients.

#4.) Unless you're really poor or old, you'll get fined for not having health insurance. By 2014, you either need to buy insurance, get it from work, or be poor enough to get it from the government. Otherwise you get fined $695 a year.


--THE RICH. Bad news. Starting in 2012, if your family's investments are making more than $250,000-a-year, or your personal investments are making more than $200,000, you're going to be taxed 3.8% on those investment returns.

--Another downside for the 'rich': Insurance companies will now be taxed on their high-end "Cadillac" insurance plans . . . the kind of insurance plans that people with really good jobs get.

--The insurance companies will definitely pass that cost on to the employers. That extra cost will definitely affect businesses . . . and the people who run and invest in them.

--Now's a good time to mention that, in a way, that affects EVERYBODY. And this is where people opposed to the bill direct a lot of their anger. And it's not because they're right-wing extremists.

--It's because it's just not possible to fund almost $1 TRILLION in changes without affecting each and every person in the country. Think about it: Forcing insurance companies to cover high-risk patients, offer lower prices, AND pay higher taxes?

--Something's got to give, and the health insurance business is in for some HUGE changes. The question is: Will those changes be for the better, or worse?

--A lot of people say it'll be worse, because the only way insurance companies will be able to afford these changes is to charge MUCH higher premiums. If not, they're going to go out of business.

--And that would force people to use Medicaid or other government subsidies as their only way of affording health care.

--So in that scenario, the government will . . . over time . . . become responsible for providing health care to the vast majority of Americans.

--So while this bill doesn't socialize health care, a lot of people opposed to it argue that . . . over time . . . it WILL. But all the changes have to play out first. In the meantime, here's what the bill SAYS will happen for the rest of us . . .

--THE AVERAGE PERSON GETTING HEALTH INSURANCE FROM WORK. No obvious change. The bill has no effect on people getting insurance from their employer. At least, not on the surface level . . .

--How the insurance companies adjust to all these new policies . . . all of which are seen as bad for their business . . . remains to be seen. But for now, you personally should not see any real change, either positive or negative.

--POOR FOLKS. Very good news. The bill means that Medicaid will include more families and will include poor people without children . . . and the government will cover 100% of your medical costs through 2016.

--THE MIDDLE CLASS. In theory, good news. Individuals making up to approximately $43,320 and families making up to $88,200 will be eligible for subsidized insurance through new insurance exchanges set up in each state by 2014.

--The exchanges are the way the bill is set up to keep insurance prices more regulated and competitive. So unemployed and self-employed people SHOULD get cheaper insurance with government subsidies . . . AND not have the risk of being turned down.

(--I say "in theory" and "should" because, if the credit card reform act taught us anything, it's that companies won't take these gargantuan hits to their bottom line without thinking of every possible angle.)

(--So while this is all set up nicely and looks like a great deal . . . it would be VERY naïve to think everything's going to turn out perfectly.)

--OLD PEOPLE. Could be VERY bad. The bill slashes Medicare spending by $500 BILLION over the next decade, so senior citizens may suddenly find themselves faced with higher premiums and more expensive medications.

--The plan will try to compensate by offering seniors the highest subsidies on buying insurance and by giving them a 50% discount on name-brand drugs . . . but it doesn't look like that's going to make up for the Medicare cuts.

--PEOPLE WHO HAVE SERIOUS MEDICAL PROBLEMS. Incredible news. As of this September, insurance companies MUST cover children with pre-existing conditions. By 2014, that expands to include adults with pre-existing conditions too.

--ILLEGAL IMMIGRANTS. No news. Illegals aren't eligible for Medicaid even if they're below the poverty line, and they can't participate in the new, competitive "exchange" insurance market.

--ADULTS WHO MOVE BACK IN WITH THEIR PARENTS. Awesome news. Before, your parents could only keep you on their insurance until you were 23. Starting now, they can keep you from having to get your life together until age 26.

(CBS News / Newsweek / Fox News / Yahoo News / CNN / MSNBC)

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