Starting in 2014, most Americans will be required to buy health insurance or pay a penalty. The penalty will be phased in, starting at $95 or 1 percent of income in 2014, whichever is higher, and rising to $695 or 2.5 percent of income in 2016. But families would not pay more than $2,085.
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.
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. http://www.nytimes.com/interactive/2010/03/21/us/health-care-reform.html
Health overhaul centerpiece endures growing pains
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Premiums may be out of reach. In many states, people in their 40s and 50s face monthly premiums ranging from $400 to $600 and higher. "I think there's some sticker shock going on," said Sabrina Corlette, a Georgetown University research professor. "People who may be eligible are finding out that even if they can get the insurance, the price is too high." Pennsylvania, which set a premium of $283 for all ages, has had no problem getting applicants.
_A barrier may include requirements that people be uninsured for at least six months and that people provide documentation that they've been turned down by an insurer. "There are many people who don't meet the criteria for the federal pool, particularly the six months without coverage," said Goldman.
_In states where the federal government runs the program directly, the insurance plan doesn't provide coverage for prescription drugs until people have met a $2,500 annual deductible. "Applying this high ... deductible to the pharmacy benefit is a real barrier to consumer access to medications," Steven Browning, a Texas official, wrote HHS last week.
Insurer Cuts Health Plans as New Law Takes Hold
Published: Friday, 1 Oct 2010
By: Reed Abelson
The Principal Financial Group announced on Thursday that it planned to stop selling health insurance, another sign of upheaval emerging among insurers as the new federal health law starts to take effect.
The company, based in Iowa, provides coverage to about 840,000 people who receive their insurance through an employer.
Principal’s decision closely tracks moves by other insurers that have indicated in recent weeks that they plan to drop out of certain segments of the market, like the business of selling child-only policies. State regulators say some insurance companies are already threatening to leave particular markets because of the new law. And some regulators in states like Maine and Iowa have asked the Obama administration to give insurers more time to comply with some of the new rules.
“What you’re seeing is the beginning of some serious math and some posturing,” said Len Nichols, a health economist and policy expert at George Mason University. While some insurers, like Principal, are choosing to leave the business rather than make the necessary investments to stay, others may be simply trying to delay some of the new rules or overturn them, he said.
McDonald’s recently asked federal officials for an exemption to rules that would ban the kind of health plans many of its restaurant workers have, because the existing policies sharply limit coverage. The McDonald’s push was first reported by The Wall Street Journal on Wednesday night. A McDonald’s spokeswoman declined to comment on that report, and the company has denied any intention of dropping coverage for its employees.
So far, the administration has signaled at least some willingness to listen. In the case of McDonald’s, federal health officials told the insurer responsible for providing these plans that it would not be affected by new rules prohibiting annual limits on coverage. The new waiver will allow McDonald’s and other companies to continue offering such plans, which cap benefits, to their workers.
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The administration has already issued dozens of such waivers, as insurers and companies try to influence proposals for regulations to put the law in place. As far as giving insurers continued leeway to sell more restrictive coverage than the legislation intended, administration officials say they are trying to ensure that people do not lose their benefits before 2014, when the law is fully in effect.
“It’s the best some people can do right now, and we don’t want to disrupt it,” said Nancy-Ann DeParle, who heads the Office of Health Reform at the White House. She emphasized that the administration had been working closely with insurers and employers to deal with their concerns and objections to some of the rules. “I think we’re working together very constructively,” she said.
McDonald’s, which confirmed that its insurance carrier received a waiver from the government on annual limits, says it is negotiating with federal officials and others to determine how best to maintain employee coverage. Many of its restaurant workers are covered under plans that do not provide broad protections and limit individual insurance coverage to a few thousand dollars a year. Such plans are known as mini-med or limited benefit policies. Medical bills beyond those limits have to be paid out of pocket by employees.
The company and its franchises “are committed to finding a solution whereby we can continue to provide health care options,” said Danya Proud, McDonald’s spokeswoman.
At the Principal Financial Group, the company’s decision reflected its assessment of its ability to compete in the environment created by the new law. “Now scale really matters,” said Daniel J. Houston, a senior executive at Principal, which is headquartered in Des Moines. “We don’t have a significant concentration in any one market.”
Because Principal Financial is primarily in the business of asset management, it decided not to make the investments needed to remain competitive as a health insurer, Mr. Houston said. The company, which focused on plans sold to small businesses for their employees, does not participate in other markets, like selling policies to individuals or for people enrolled in Medicare or Medicaid.
Other aspects of the health care regulations are worrying some state insurance commissioners, who fear that insurers are going to stop selling policies in some areas of coverage. For example, in the case of child-only policies, the new rules require insurers to offer coverage to even those children who are seriously ill, leading some insurers to balk at the idea that they will be forced to cover too many sick children. Aetna, Cigna and WellPoint, among others, have said they will stop selling new policies in some states.
“Disruption in our marketplaces is a concern for insurance commissioners,” said Jane L. Cline, the president of the National Association of Insurance Commissioners, who is also a West Virginia regulator.
In the case of Principal Financial, UnitedHealth Group’s insurance plans have agreed to offer coverage to Principal’s customers. “They are clearly going to be a long-term player in this market,” Mr. Houston said.
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More insurers are likely to follow Principal’s lead, especially as they try to meet the new rules that require plans to spend at least 80 cents of every dollar they collect in premiums on the welfare of their customers. Many of the big insurers have been lobbying federal officials to forestall or drastically alter those rules.
“It’s just going to drive the little guys out,” said Robert Laszewski, a health policy consultant in Alexandria, Va. Smaller players like Principal in states like Iowa, Missouri and elsewhere will not be able to compete because they do not have the resources and economies of scale of players like UnitedHealth, which is among the nation’s largest health insurers.
Mr. Laszewski is worried that the ensuing concentration is likely to lead to higher prices because large players will no longer face the competition from the smaller plans. “It’s just the UnitedHealthcare full employment act,” he said.
This story originally appeared in the The New York Times