How the Health Care Overhaul Could Affect You

Published: March 21, 2010
How the Health Care Overhaul Could Affect You

Major ways the overhaul will affect those who currently have health insurance and those who do not.

If you are insured and pay on your own

You can keep your current plan— or —you can buy coverage through new state-run insurance marketplaces, called “exchanges,” starting in 2014.

If you keep your current plan

*

Within six months, the plans will have to stop some practices, like setting lifetime limits on coverage and canceling policy holders who get sick. They will also have to allow children to stay on their parents’ policies through age 26 and cover children with pre-existing conditions, but can still deny adults with medical problems until 2014.
*

Premiums for individual policies will be 10 to 13 percent higher by 2016 than the average premium that year under current law, according to Congressional estimates. But most people would qualify for subsidies, meaning they might pay less than they do now.
*

High-income earners — families making more than $250,000 — will pay several thousand dollars more in Medicare payroll taxes starting in 2018. Their unearned income, now exempt from the payroll tax, would also be subject to a 3.8 percent levy.

Or you may be eligible for subsidized coverage

*

A family of four with an income less than about $88,000 can get tax credits, on a sliding scale, to help them pay insurance premiums and deductibles.
*

Health plans on exchanges can offer abortion coverage. But if they do, subscribers who get federal subsidies will have to make separate premium payments for the abortion coverage. States can also ban this coverage.




If you are insured through your employer
You can keep your current plan — or — you can buy coverage through new state-run insurance marketplaces, called “exchanges,” starting in 2014.

If you keep your current plan

*

Within six months, the plans will have to stop some practices, like setting lifetime limits on coverage and canceling policy holders who get sick. They will also have to allow children to stay on their parents’ policies through age 26 and cover children with pre-existing conditions, but can still deny adults with medical problems until 2014.
*

High-value group plans — those in which premiums for families are $27,500 or more, for instance — will have to pay a 40 percent excise tax in 2014.
*

Starting in 2013, flexible spending accounts, which allow users to escape taxes on many medical expenses now, will be limited. There will be a $2,500 maximum on accounts that typically carry $4,000 or $5,000 limits now, and you will no longer be able to use the accounts for over-the-counter medicines.
*

High-income earners — families making more than $250,000 – would pay several thousand dollars more in Medicare payroll taxes starting in 2018. Their unearned income, now exempt from the payroll tax, would also be subject to a 3.8 percent levy.

Or you may be eligible for eligible to buy insurance through the exchanges

*

If your employer’s policy covers less than 60 percent of costs, or you are paying more than 9.5 percent of your income to get it, you can buy subsidized coverage on the exchanges.
*

If you receive subsidies and enroll in a health plan that covers abortion, you will have to pay a separate premium for that coverage. And states could prohibit abortion coverage by these plans.
*

You can get a voucher from your employer to buy insurance on the exchanges if your income is below $88,000 for a family of four, and your premiums cost between 8 and 9.8 percent of your income.




If you are insured and receive coverage from Medicare
You will pay less for preventive care and prescription drugs. Your benefits might change if you are insured through a private Medicare Advantage plan.

Preventive care

Medicare will pay for an annual checkup. And deductibles and co-payments for many preventive services and screenings will be eliminated.

Prescription drug coverage

The gap in coverage of prescription drugs, known as the “doughnut hole,” will be gradually filled by 2020. This year, consumers who hit the doughnut hole will receive a $250 rebate. Subsidies would be reduced for individuals making more than $85,000 or couples making more than $170,000.

Enrolled in Medicare Advantage

Subsidies for these plans run by insurance companies under contract with the government will be slashed substantially, leaving their 10 million beneficiaries with the prospect of higher premiums or reduced benefits.




If you are insured and receive coverage from Medicaid
You and your children can maintain eligibility and receive free preventive services.

Adults

States cannot cut people from Medicaid until the exchanges start operating in 2014, unless a state faces a budget shortfall. Many preventive services would be offered without cost.

Children

States cannot cut children from Medicaid or the Children’s Health Insurance Program until 2019.




If you are uninsured, you can get coverage from a high-risk pool
If you are refused coverage because of your health, you can get insurance from a new high-risk pool.

The pool will be established within six months and will operate until 2014, when insurance companies can no longer refuse applicants with pre-existing health problems. Annual out-of-pocket medical costs will be capped at $5,950 for individuals and $11,900 for families.



If you are uninsured, you can get coverage through Medicaid
You can obtain coverage through Medicaid

Starting in 2014, anyone with an income below 133 percent of the poverty level — or about $29,327 in 2009 for a family of four — will be eligible for a rejuvenated Medicaid program. Medicaid’s often anemic reimbursements will be increased to the same level as Medicare, making more doctors willing to accept it.




If you are uninsured, you can get coverage from exchange
If your employer does not cover you, and you make too much to qualify for Medicaid, you can buy from private insurers through exchanges starting in 2014.

*

Coverage for those making up to four times the poverty threshold — $88,200 for a family of four in 2009 — will get subsidies on a sliding scale. That means you will pay somewhere between 3 percent and 9.5 percent of your income for insurance, and the government will cover the rest.
*

Health plans will cover at least 60 percent of medical costs. Insurers will also have to offer more tiers that cover up to 90 percent of costs for additional premiums.
*

Premiums of older people can be no more than three times as expensive as those of younger people.
*

There will also be limits on overhead and profit. Insurers will be required to spend between 80 cents and 85 cents of every premium dollar on health care. They have been paying about 74 cents on average.
*

Health plans on exchanges can offer abortion coverage. But if they do, subscribers who get federal subsidies will have to make separate premium payments for the coverage. States can prohibit abortion coverage.





If you do not buy insurance
Starting in 2014, most Americans will be required to buy health insurance or pay a penalty.

*

The penalty will be phased in, starting at 1 percent of income in 2014, and rising to the maximum of $2,085 for a family in 2016.
*

American Indians don’t have to buy insurance. Those with religious objections or a financial hardship can also avoid the requirement. And if you would pay more than 8 percent of your income for the cheapest available plan, you will not be penalized for failing to buy coverage.
*

Those who are exempt, or under 30, can buy a policy that only pays for catastrophic medical costs. It must allow for three primary care visits a year as well.

By FARHANA HOSSSAIN and KEVIN QUEALY

NYT Link