Another go at understanding health care reform
October 23, 2009Jon Brooks Comments Off
The journal Health Affairs has posted another in a series of health policy briefs designed to summarize the key issues in the debate. Calling any of these policy analyses “brief” may be pushing it, but if you have the time and patience to wade through them, they can help clarify the various issues in play.
The latest is called Health Insurance Reforms and its most interesting component is a comparison of the similarities and differences between the various congressional bills that must now be melded into one final piece of legislation.
Here are some of the new requirements and limitations on health insurers (or, put another way, the rights of their customers) stipulated in all of the bills:
• Coverage would have to be sold to anybody who applied for it, regardless of health status. This is the provision known as guaranteed issue.
• Renewability of coverage would have to be guaranteed, which means that policies that are sold to individual policy holders or to a small business would have to be renewed from one year to the next.
• Coverage could not exclude payment of claims for treatments involving an individual’s pre-existing medical conditions. For example, an insurer could not sell a policy to a person with hypertension that explicitly did not cover claims related to his or her high blood pressure.
• Premiums charged to individuals buying coverage through a particular exchange could not vary based on an applicant’s gender, employment, or health status. This is called community rating.• There would be limits on how much companies could vary the premiums charged to different policy holders based on age, family, or place of residence. The Senate Finance Committee bill would allow insurers to vary premiums by as much as four to one based on age; this means that a 64-year-old enrollee could be charged four times as much as a 19-year-old. Under the House and HELP Committee bills, premiums could vary by as much as two to one based on age.
• Both Senate bills would also allow companies to vary premiums based on whether an applicant used tobacco products.
• Insurers would not be able to set annual or lifetime limits on the amount of claims they will pay in a policy holder’s behalf.
• Policy holders would see their annual out-of-pocket expenses for health care capped at specific levels. For example, the Senate Finance bill would adopt the same limit set for health savings accounts ($5,950 for individuals and $11,900 for families in 2010). The Senate HELP bill also adopts that same limit, but varies it depending on the plan type. The House bill’s out-of-pocket limit is $5,000 for individuals and $10,000 for families (with annual increases based on the Consumer Price Index).
• Health insurers would be required to provide enrolled individuals with coverage for emergency room services at any hospital without the need for prior authorization. Enrollees could not be charged copayments or cost sharing for emergency room services furnished out-of-network that are higher than in-network rates.
For differences between the bills, an explanation of the health insurance exchanges that would be created, and the individual mandate to obtain insurance or pay a penalty, see the full article.
