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|Health Care Reform Update
Provisions of the Affordable Care Act
NEW CONSUMER PROTECTIONS 2010
- Prohibiting Denying Coverage of Children Based on Pre-Existing Conditions. The new law includes new rules to prevent insurance companies from denying coverage to children under the age of 19 due to a pre-existing condition. Effective for health plan years beginning on or after September 23, 2010 for new plans and existing group plans.
- Prohibiting Insurance Companies from Rescinding Coverage. In the past, insurance companies could search for an error, or other technical mistake, on a customer's application and use this error to deny payment for services when he or she got sick. The new law makes this illegal. After media reports cited incidents of breast cancer patients losing coverage, insurance companies agreed to end this practice immediately. Effective for health plan years beginning on or after September 23, 2010.
- Eliminating Lifetime Limits on Insurance Coverage. Under the new law, insurance companies will be prohibited from imposing lifetime dollar limits on essential benefits, like hospital stays. Effective for health plan years beginning on or after September 23, 2010
- Regulating Annual Limits on Insurance Coverage. Under the new law, insurance companies' use of annual dollar limits on the amount of insurance coverage a patient may receive will be restricted for new plans in the individual market and all group plans. In 2014, the use of annual dollar limits on essential benefits like hospital stays will be banned for new plans in the individual market and all group plans. Effective for health plan years beginning on or after September 23, 2010.
- Appealing Insurance Company Decisions. The law provides consumers with a way to appeal coverage determinations or claims to their insurance company, and establishes an external review process. Effective for new plans beginning on or after September 23, 2010.
- Putting Information for Consumers Online. The law provides for an easy-to-use websitewhere consumers can compare health insurance coverage options and pick the coverage that works for them. Effective July 1, 2010.
IMPROVING QUALITY AND LOWERING COSTS
- Providing Small Business Health Insurance Tax Credits. Up to 4 million small businesses are eligible for tax credits to help them provide insurance benefits to their workers. The first phase of this provision provides a credit worth up to 35 percent of the employer's contribution to the employees' health insurance. Small non-profit organizations may receive up to a 25 percent credit. Effective now.
- Offering Relief for 4 Million Seniors Who Hit the Medicare Prescription Drug "Donut Hole." An estimated four million seniors will reach the gap in Medicare prescription drug coverage known as the "donut hole" this year. Each such senior will receive a $250 rebate.First checks mailed in June, 2010, and will continue monthly throughout 2010 as seniors hit the coverage gap.
- Providing Free Preventive Care. All new plans must cover certain preventive services such as mammograms and colonoscopies without charging a deductible, co-pay or coinsurance. Effective for health plan years beginning on or after September 23, 2010. Learn more about preventive care benefits
- Preventing Disease and Illness. A new $15 billion Prevention and Public Health Fund will invest in proven prevention and public health programs that can help keep Americans healthy - from smoking cessation to combating obesity. Funding begins in 2010.
- racking Down on Health Care Fraud. Current efforts to fight fraud have returned more than $2.5 billion to the Medicare Trust Fund in fiscal year 2009 alone. The new law invests new resources and requires new screening procedures for health care providers to boost these efforts and reduce fraud and waste in Medicare, Medicaid, and CHIP. Many provisions effective now.
INCREASING ACCESS TO AFFORDABLE CARE
- Providing Access to Insurance for Uninsured Americans with Pre-Existing Conditions. A new Pre-Existing Condition Insurance Plan will provide new coverage options to individuals who have been uninsured for at least six months because of a pre-existing condition. States have the option of running this new program in their state. If a state chooses not to do so, a plan will be established by the Department of Health and Human Services in that state. National program effective July 1, 2010.
- Extending Coverage for Young Adults. Under the new law, young adults will be allowed to stay on their parents' plan until they turn 26 years old (in the case of existing group health plans, this right does not apply if the young adult is offered insurance at work). While the provision takes effect in September, many insurance companies have already implemented this new practice. Check with your insurance company or employer to see if you qualify. Effective for health plan years beginning on or after September 23.
- Expanding Coverage for Early Retirees. Too often, Americans who retire without employer-sponsored insurance and before they are eligible for Medicare see their life savings disappear because of high rates in the individual market. To preserve employer coverage for early retirees until more affordable coverage is available through the new Exchanges by 2014, the new law creates a $5 billion program to provide needed financial help for employment-based plans to continue to provide valuable coverage to people who retire between the ages of 55 and 65, as well as their spouses and dependents. Applications for employers to participate in the program available June 1, 2010
- Rebuilding the Primary Care Workforce. To strengthen the availability of primary care, there are new incentives in the law to expand the number of primary care doctors, nurses and physician assistants. These include funding for scholarships and loan repayments for primary care doctors and nurses working in underserved areas. Doctors and nurses receiving payments made under any State loan repayment or loan forgiveness program intended to increase the availability of health care services in underserved or health professional shortage areas will not have to pay taxes on those payments.
- Holding Insurance Companies Accountable for Unreasonable Rate Hikes. The law allows states that have, or plan to implement measures that require insurance companies to justify their premium increases will be eligible for $250 million in new Insurance companies with excessive or unjustified premium exchanges may not be able to participate in the new&health insurance Exchanges in 2014.Grants awarded beginning in 2010.
- Allowing States to Cover More People on Medicaid. States will be able to receive federal matching funds for covering some additional low-income individuals and families under Medicaid for whom federal funds were not previously available. This will make it easier for states that choose to do so to cover more of their residents. Effective April 1, 2010.
- Increasing Payments for Rural Health Care Providers. Today, 68 percent of medically underserved communities across the nation are in rural areas. These communities often have trouble attracting and retaining medical professionals. The law provides increased payment to rural health care providers to help them continue to serve their communities. Effective 2010.
- Strengthening Community Health Centers. The law includes new funding to support the construction of and expand services at community health centers, allowing these centers to serve some 20 million new patients across the country. Effective 2010.