What Does Health Care Reform Really Mean?

Now that a health care reform bill has passed, many are wondering what the bill will really do for them. Below is a timeline of when aspects of the bill will go into effect:

In three months:

• Individuals who have not been able to find coverage because of a pre-existing condition will be eligible for subsidized coverage through a high-risk insurance program.

In six months:

• Many insurance plans will be prohibited from placing lifetime limits on medical coverage,
• Insurance companies can no longer cancel policies of people who become ill,
• Children with pre-existing conditions can not be denied coverage, and
• Dependent children can remain on their parents' health insurance plans until age 26.

In one year:

• Senior citizens will receive more help paying for drugs in Medicare,
• There will be more oversight of premium increases, and
• Businesses with fewer than 25 employees and average wages of less than $50,000 could qualify for a tax credit of up to 35 percent of the cost of their premiums.

In 2013:

• Individuals with annual incomes over $200,000 and couples with annual incomes over $250,000 will be required to pay an additional 3.8 percent tax on their investment income and will contribute more to the Medicare program from their payroll taxes, and
• The most expensive insurance policies will be subject to a new tax.

In 2014:

• State insurance marketplaces called “exchanges" will be created,
• Individuals with pre-existing conditions will no longer be denied insurance,
• State Medicaid programs will be expanded,
• All lifetime and annual limits on coverage would be eliminated
• Employers with 50 or more workers could face federal fines for not providing insurance coverage,
• Individuals who do not obtain coverage could face a federal penalty (In the first year they would owe $95, or 1 percent of income, whichever is greater. The penalty would then increase to $695, or 2 percent of income. Families who fall below the income-tax filing thresholds would not owe anything. Nor would people who cannot find a policy that costs less than 8 percent of their income.)