Health care reform in the United States

Health care reform in the United States has a long history

History of health care reform in the United States

The issue of health insurance reform in the United States has been the subject of political debate since the early part of the 20th century. Recent reforms remains an active political issue...

, of which the most recent results were two federal

Federal

Federal or foederal may refer to:In politics:*Federal monarchy, a federation of monarchies or a federal organised monarchy*Federal district, a subdivision in a federal state that is under the direct control of a federal government...

statutes enacted in 2010: the Patient Protection and Affordable Care Act

Patient Protection and Affordable Care Act

The Patient Protection and Affordable Care Act is a United States federal statute signed into law by President Barack Obama on March 23, 2010. The law is the principal health care reform legislation of the 111th United States Congress...

(PPACA), signed March 23, 2010, and the Health Care and Education Reconciliation Act of 2010

Health Care and Education Reconciliation Act of 2010

The Health Care and Education Reconciliation Act of 2010 is a law that was enacted by the 111th United States Congress, by means of the reconciliation process, in order to amend the Patient Protection and Affordable Care Act...

, which amended the PPACA and became law on March 30.

History of national reform efforts

Here is a summary of reform achievements at the national level in the United States. For failed efforts, State based efforts, native tribes services and more details generally, see the main article History of health care reform in the United States

History of health care reform in the United States

The issue of health insurance reform in the United States has been the subject of political debate since the early part of the 20th century. Recent reforms remains an active political issue...

1965 President Lyndon Johnson enacted legislation which introduced Medicare
Medicare (United States)
Medicare is a social insurance program administered by the United States government, providing health insurance coverage to people who are aged 65 and over; to those who are under 65 and are permanently physically disabled or who have a congenital physical disability; or to those who meet other...

, covering both hospital and general medical insurance for senior citizens paid for by a Federal employment tax over the working life of the retiree, and Medicaid
Medicaid
Medicaid is the United States health program for certain people and families with low incomes and resources. It is a means-tested program that is jointly funded by the state and federal governments, and is managed by the states. People served by Medicaid are U.S. citizens or legal permanent...

permitted the Federal government to partially fund a program for the poor, with the program managed and co-financed by the individual states.

1985 The Consolidated Omnibus Budget Reconciliation Act of 1985
Consolidated Omnibus Budget Reconciliation Act of 1985
The Consolidated Omnibus Budget Reconciliation Act of 1985 is a law passed by the U.S. Congress on a reconciliation basis and signed by President Reagan that, among other things, mandates an insurance program giving some employees the ability to continue health insurance coverage after leaving...

(COBRA) amended the Employee Retirement Income Security Act
Employee Retirement Income Security Act
The Employee Retirement Income Security Act of 1974 is an American federal statute that establishes minimum standards for pension plans in private industry and provides for extensive rules on the federal income tax effects of transactions associated with employee benefit plans...

of 1974 (ERISA) to give some employees the ability to continue health insurance
Health insurance
Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care expenses among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is...

coverage after leaving employment.

1997 The State Children's Health Insurance Program, or SCHIP, was established by the federal government in 1997 to provide health insurance to children in families at or below 200 percent of the federal poverty line.

2010 The Patient Protection and Affordable Care Act
Patient Protection and Affordable Care Act
The Patient Protection and Affordable Care Act is a United States federal statute signed into law by President Barack Obama on March 23, 2010. The law is the principal health care reform legislation of the 111th United States Congress...

is enacted by President Barack Obama
Barack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...

, providing for the phased introduction over four years of a comprehensive system of mandated health insurance with reforms designed to eliminate "some of the worst practices of the insurance companies" — pre-condition screening and premium loadings, policy rescinds on technicalities when illness seems imminent, lifetime and annual coverage caps. It also sets a minimum ratio of direct health care spending to premium income, and creates price competition bolstered by the creation of three standard insurance coverage levels to enable like-for-like comparisons by consumers, and a web based health insurance exchange where consumers can compare prices and purchase plans. The system preserves private insurance and private health care providers and provides more subsidies to enable the poor to buy insurance.

The 2010 Federal Reform Legislation

In March 2010, President Obama gave a speech at a rally in Pennsylvania explaining the necessity of health insurance reform and calling on Congress to hold a final up or down vote on reform. As of 2011, the legislation remains controversial, with most states challenging it in federal court and most voters opposed.

Expanding Medicaid and subsidizing insurance

The law includes health-related provisions to take effect over several years, including expanding Medicaid

Medicaid

Medicaid is the United States health program for certain people and families with low incomes and resources. It is a means-tested program that is jointly funded by the state and federal governments, and is managed by the states. People served by Medicaid are U.S. citizens or legal permanent...

eligibility for people making up to 133% of the federal poverty level (FPL), subsidizing insurance premiums for people making up to 400% of the FPL ($88,000 for family of 4 in 2010) so their maximum "out-of-pocket" payment for annual premiums will be on sliding scale

Sliding scale fees

Sliding scale fees are variable costs for products, services, or taxes based on one's ability to pay. Such fees are thereby reduced for those who have lower incomes or less money to spare after their personal expenses, regardless of income....

from 2% to 9.8% of income, providing incentives for businesses to provide health care benefits, prohibiting denial of coverage and denial of claims based on pre-existing conditions, establishing health insurance exchange

Health insurance exchange

A health insurance exchange is a set of state-regulated and standardized health care plans in the United States, from which individuals may purchase health insurance that is eligible for Federal subsidies...

s, prohibiting insurers from establishing annual coverage caps, and support for medical research.

Guaranteed issue, community rating, individual mandate

Starting in 2014, the law will prohibit insurers from denying coverage (see guaranteed issue

Guaranteed issue

Guaranteed issue is a term used in health insurance to describe a situation where a policy is offered to all applicants, regardless of the health status of the applicant...

) to sicker applicants, or imposing special conditions such as higher premiums or payments (see community rating

Community rating

Community rating is a concept usually associated with health insurance, which requires health insurance providers to offer health insurance policies within a given territory at the same price to all persons without medical underwriting, regardless of their health status.Pure community rating...

). Health care expenditures are highly concentrated with the most expensive 5% of the population accounting for half of aggregate health care spending, whereas the bottom 50% of spenders account for only 3%, which means that insurers' gains to be had from avoiding the sick greatly outweigh any possible gains from managing their care. As a consequence, insurers devoted resources to such avoidance at a direct cost to effective care management which is against the interests of the insured. Instead of providing health security, the health insurance industry had, since the 1970s begun to compete by becoming good risk differentiators, seeking to insure only those with good or normal health profiles and excluding those considered to be or likely to become unhealthy and therefore less profitable. According to a study from Cambridge Hospital

Cambridge Hospital

The Cambridge Hospital campus is a community teaching hospital located in Cambridge, Massachusetts. It is one of three hospital campuses that are part of Cambridge Health Alliance.-Services:...

, Harvard Law School

Harvard Law School

Harvard Law School is one of the professional graduate schools of Harvard University. Located in Cambridge, Massachusetts, it is the oldest continually-operating law school in the United States and is home to the largest academic law library in the world. The school is routinely ranked by the U.S...

and Ohio University

Ohio University

Ohio University is a public university located in the Midwestern United States in Athens, Ohio, situated on an campus...

, 62% of all 2007 personal bankruptcies in the United States

Bankruptcy in the United States

Bankruptcy in the United States is governed under the United States Constitution which authorizes Congress to enact "uniform Laws on the subject of Bankruptcies throughout the United States." Congress has exercised this authority several times since 1801, most recently by adopting the Bankruptcy...

"were driven by medical incidents, with [75% having had] health insurance."

Also starting in 2014, the law will generally require uninsured individuals to buy government-approved health insurance — the individual mandate

Health insurance mandate

A health insurance mandate is either an employer or individual mandate to obtain private health insurance, instead of a National Health Service or National Health Insurance.-United States:...

. Government-run exchanges may present information to facilitate comparison among competing plans, if available, but previous attempts at creating similar exchanges “produced only mixed results." This requirement is expected to reduce the number of the uninsured from 19% of all residents in 2010 to 8% by 2016. The 8% figure of uninsured are expected to be mostly illegal immigrants (5%), with the rest paying the fine unless exempted.

The insurance premium structure reportedly shifts more costs onto younger and healthier people. Approximately $43 billion was spent in 2008 providing unreimbursed emergency services for the uninsured and the Act's supporters argued that increased the average family's insurance premiums. However, careful statistical studies have shown the opposite: "The argument for reduced ER visits has been shown to be largely a canard...insuring the uninsured will lead to, very approximately, a doubling of health expenditures for the currently uninsured." Making insurance mandatory rather than voluntary will tend to bring younger, healthier people into the insurance pool, shifting the cost of the Act's increased spending onto them.

Efficacy of health insurance

The 2010 Acts require insurers to cover more costs, requiring that at least 80% of premiums must be spent on medical care or "quality improvement" (see loss ratio

Loss ratio

In insurance, the loss ratio is the ratio of total losses paid out in claims plus adjustment expenses divided by the total earned premiums. For example, if an insurance company pays out $60 in claims for every $100 in collected premiums, then its loss ratio is 60%.Loss ratios for property and...

) and requiring full coverage for screenings and immunizations, and by prohibiting lifetime and annual caps. Some insurance schemes had been considered inadequate.

Some argue that expanding insurance coverage may lead to better health, but statistical studies have found mixed results. A 2009 Harvard study published in the American Journal of Public Health
American Journal of Public Health
The American Journal of Public Health is a monthly peer-reviewed medical journal published by the American Public Health Association covering health policy and public health. The journal was established in 1911 and its stated mission is "to advance public health research, policy, practice, and...

found more than 44,800 excess deaths annually in the United States associated with lack of insurance. Other studies found less correlation, however, and "what may be the largest and most comprehensive analysis yet done of the effect of insurance on mortality...found no significantly elevated risk of death among the uninsured." More broadly, a 1997 analysis estimated the number of people in the United States—insured and uninsured—who die per year because of lack of medical care was nearly 100,000. Recent reports have found that expanding coverage for psychiatric drugs has worsened the health of many children, who incur costly and lifelong side effects such as diabetes. Moreover, "80,000 people a year are killed just by “nosocomial infections”—infections that arise as a result of medical treatment. The only truly experimental study on health insurance, a randomized study of almost 4,000 subjects done by Rand and concluded in 1982, found that increasing the generosity of people’s health insurance caused them to use more health care, but made almost no difference in their health status."

Reduce the deficit

Reducing the deficit was another driver in health care reform. The reform legislation that passed was estimated by the Congressional Budget Office

Congressional Budget Office

The Congressional Budget Office is a federal agency within the legislative branch of the United States government that provides economic data to Congress....

to reduce the deficit by $143 billion over 10 years.
However, the CBO numbers are the subject of some debate.

Eliminate overpayment in Medicare Advantage

Medicare Advantage plans are offered by private insurers and provide benefits over and above coverage in Medicare Parts A and B and receive funding from the Medicare fund for taking on Part A and B coverage. However, under a revised contract made during the previous Bush presidency, Medicare was overpaying the private insurers. MedPAC estimated the overpayment as being approximately $12 billion a year. This meant that the average person in traditional Medicare was paying $90 a year as a subsidy to private insurers for which they received zero benefit and eliminating this overpayment would save $177 billion over ten years.

Political positions of the main parties

The Democratic Party supports the amended 2010 legislation. Its policy as enshrined in the Act is to ensure health insurance is available to all citizens; to make more employers responsible for their workers' health insurance; to extend subsidies to middle income persons who have no employer insurance; and extend Medicaid to more people than had been the case previously. The Act directs federal spending to community health centers and to computerize health care records to encourage accurate sharing of data between health providers and reduce errors. The Act taxes expensive insurance plans and adjusts the split of Medicare funding between traditional Medicare and Medicare Advantage plans. The Act reforms payment systems and Medicare, which may reduce the perverse incentive system that pays hospitals with poor recovery records more than hospitals with better recovery records. The Act increases Medicare prescription drug coverage. President Obama said he had heard from Americans with pre-existing conditions whose lives depend on getting insurance coverage; stories of patients being denied coverage, and of families with insurance who are just one illness away from financial ruin. He said that the Act would protect people from the worst practices of the insurance industry. He said it would give small businesses and uninsured Americans a chance to choose an affordable health care plan in a competitive market. He claimed that if they did nothing, millions of Americans would lose their health care and the deficit would grow. He said that premiums would increase and patients would be denied the care they need, and that small business owners would continue to drop coverage altogether. He said he would not walk away from those Americans, and he urged others in Congress not to do so either. He highlighted that the American Medical Association

American Medical Association

The American Medical Association , founded in 1847 and incorporated in 1897, is the largest association of medical doctors and medical students in the United States.-Scope and operations:...

considers the Act an improvement over the status quo. He challenged anyone, from either party, with a better plan that would bring down premiums, bring down the deficit, cover the uninsured, strengthen Medicare for seniors, and stop insurance company abuses, to let him know.

The GOP

Republican Party (United States)

The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...

's official current position as represented by the House majority is that the Affordable Care Act should simply be repealed, leaving the law as it was previously. The House of Representatives voted for this in January 2011, though it is unlikely that the Senate would pass it and some expect that the President would veto any attempt at repeal. The Republicans previous proposal for health care reform in 2009 would have placed people with pre-existing conditions who are unable to get affordable coverage into high risk insurance pools and would have continued the previous practice of allowing insurers to discriminate against them in terms of coverage and premiums. Republicans opposed the Affordable Care Act during passage. Not a single representative in the House or Senate voted in favor of the bill. This opposition was broadly based on objections to rises in taxation, especially of the so-called "Cadillac insurance plans" and the corollary increase in government spending on affordability subsidies. The GOP also objected to a new Health Insurance Rate Authority that would determine whether rate increases were "unreasonable" and to enforced rebates or premium reductions, and to any proposal that might have allowed government funds to subsidize abortion

Abortion

Abortion is defined as the termination of pregnancy by the removal or expulsion from the uterus of a fetus or embryo prior to viability. An abortion can occur spontaneously, in which case it is usually called a miscarriage, or it can be purposely induced...

. The opposition declared the law to be a "government takeover of health care". One version of an original draft prepared in the House of Representatives did call for a "public option" (a public insurer as one extra choice for consumers, competing against private insurers). Some Republicans have contested the constitutionality of the individual health insurance mandate

Health insurance mandate

A health insurance mandate is either an employer or individual mandate to obtain private health insurance, instead of a National Health Service or National Health Insurance.-United States:...

(a requirement to have medical insurance or else pay a fine). Both the government and the insurance industry have argued that this is a necessary prerequisite to achieve universality and equity for other insurance payers and to prevent people buying insurance only in time of need. The government argues that its constitutionality is covered under the Commerce Clause

Commerce Clause

The Commerce Clause is an enumerated power listed in the United States Constitution . The clause states that the United States Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." Courts and commentators have tended to...

, whereas detractors argue that this is wrong. As of 2010, this matter is still before the courts and so far 3 out of five federal court decisions have ruled in favor of it being constitutional and two against. Mitt Romney

Mitt Romney

Willard Mitt Romney is an American businessman and politician. He was the 70th Governor of Massachusetts from 2003 to 2007 and is a candidate for the 2012 Republican Party presidential nomination.The son of George W...

has said that the new law does not resemble the Massachusetts health care plan and did not support it. Some Republicans (for example Charles Grassley) as well as the conservative think tank Heritage Foundation

Heritage Foundation

The Heritage Foundation is a conservative American think tank based in Washington, D.C. Heritage's stated mission is to "formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong...

previously supported an individual mandate, but no longer do. The same is true of the concept of the insurance exchanges which the bill sets up, which some Republicans and the Heritage Foundation once supported.

Betsy McCaughey, a health care analyst who came to political prominence after she helped defeat the Clinton health care plan of 1993, "got the ball rolling" in July and August 2009 when she called the bill "a vicious assault on elderly people" that will "cut your life short". McCaughey was joined in spreading the idea by other pundits and conservative media that had had helped defeat the Clinton era legislation, including The Washington Times and The American Spectator
The American Spectator
The American Spectator is a conservative U.S. monthly magazine covering news and politics, edited by R. Emmett Tyrrell Jr. and published by the non-profit American Spectator Foundation. From its founding in 1967 until the late 1980s, the small-circulation magazine featured the writings of authors...

. According to The New York Times, McCaughey also falsely claimed that presidential advisor Dr. Ezekiel Emanuel thought that the disabled should not be entitled to medical care, which helped inspire Palin's warnings about "death panels". Both McCaughey and Palin's remarks about what Palin called an alleged 'death panel' were based on opinions about Ezekiel Emanuel and previous page 425 legislation.

Emanuel is an opponent of legalization of doctor-assisted suicide or euthanasia. FactCheck.org said, "We agree that Emanuel’s meaning is being twisted. In one article, he was talking about a philosophical trend, and in another, he was writing about how to make the most ethical choices when forced to choose which patients get organ transplants or vaccines when supplies are limited." An article on Time.com said that Emanuel "was only addressing extreme cases like organ donation, where there is an absolute scarcity of resources ... 'My quotes were just being taken out of context.'" Regarding page 425 of a health care bill, Congressman Earl Blumenauer

Earl Blumenauer

Earl Blumenauer is the U.S. Representative for , serving since 1996. He is a member of the Democratic Party. The district includes most of Portland east of the Willamette River. A native of Portland, he previously spent over 20 years as a public official representing the city.-Early...

(who sponsored the legislation) said the measure would block funds for counseling that presents suicide or assisted suicide as an option, and called references to death panels or euthanasia "mind-numbing". Page 425 of this legislation is similar to end-of-life counseling that became law when George W. Bush

George W. Bush

George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....

was president.

A lot of the political debate centered on the prevention of the Federal funding of abortion with some groups claiming that abortion would become easier or would be financed by the government. In the legislation that was finally passed the existing law preserved the principle of no federal funding for abortion (except in cases of rape, incest, or to preserve the life of the mother). The law requires people to pay for that element of coverage with a separate check to create a specific fund which is not subsidized and which is used to fund these services. State insurance commissioners are charged with policing this “segregation of funds”. Whether insurers in the exchanges can offer abortion coverage at all was left as a matter for individual States to decide. The default is that insurers will be allowed to offer abortion coverage as they do now unless a State passes legislation to the contrary.

Lobbying

According to Obama, America's health insurance industry has spent hundreds of millions of dollars to block the introduction of public medical insurance and stall other proposed legislation. There are six registered health care lobbyists for every member of Congress. The campaign against health care reform has been waged in part through substantial donations to key politicians. The single largest recipient of health industry political donations and chairman of the Senate Committee on Finance that drafted Senate health care legislation is Senator Max Baucus

Max Baucus

Max Sieben Baucus is the senior United States Senator from Montana and a member of the Democratic Party. First elected to the Senate in 1978, as of 2010 he is the longest-serving Senator from Montana, and the fifth longest-serving U.S...

(D-MT

Montana

Montana is a state in the Western United States. The western third of Montana contains numerous mountain ranges. Smaller, "island ranges" are found in the central third of the state, for a total of 77 named ranges of the Rocky Mountains. This geographical fact is reflected in the state's name,...

). A single health insurance company, Aetna

Aetna

Aetna, Inc. is an American health insurance company, providing a range of traditional and consumer directed health care insurance products and related services, including medical, pharmaceutical, dental, behavioral health, group life, long-term care, and disability plans, and medical management...

, has contributed more than $110,000 to one legislator, Senator Joe Lieberman

Joe Lieberman

Joseph Isadore "Joe" Lieberman is the senior United States Senator from Connecticut. A former member of the Democratic Party, he was the party's nominee for Vice President in the 2000 election. Currently an independent, he remains closely affiliated with the party.Born in Stamford, Connecticut,...

(ID

Independent Democrat

Independent Democrat is a term occasionally adopted by American politicians to refer to their party affiliation. Several elected officials, including members of Congress, have identified as " Independent Democrats."...

-CT

Connecticut

Connecticut is a state in the New England region of the northeastern United States. It is bordered by Rhode Island to the east, Massachusetts to the north, and the state of New York to the west and the south .Connecticut is named for the Connecticut River, the major U.S. river that approximately...

), in 2009.

America's Health Insurance Plans, a lobby group funded by American private health insurance companies published its plans for health care reform in December 2008. The key elements called for co-ordinated national strategy for health care with insurance regulation set in a national framework but enforced by the states. It also called for a personal health care mandate requiring every American to have health insurance or face penalties. This, it said, was a necessary pre-requisite for guaranteed issue policies to prevent insurers from having to pre-screen applicants and set limits on coverage for pre-existing conditions, otherwise healthy people would put off buying insurance until they get sick. It also called for the establishment of body to reform the payment system (including a shift from fee-for-service to fee-for-quality-outcomes), and a body to undertake Comparative effectiveness research because it admitted that the current system was not effective at providing value for money or even best practice and computerization and standardization of health care records and claims processing. Most of the issues which AHIP called for in its plans have been implemented by the Obama administration and Congress in the reform process with the exception of a completely national framework for health care insurance regulation. Though the bill does place certain national rules for insurance to qualify as being "coverage" acceptable within the meaning of the individual mandate, states have retained the power under the reforms to regulate the industry and this was not put in a national framework.

Possible future reforms

The Patient Protection and Affordable Health Care Act 2010 contained provisions which allows the Centers for Medicare and Medicaid Services

Centers for Medicare and Medicaid Services

The Centers for Medicare & Medicaid Services , previously known as the Health Care Financing Administration , is a federal agency within the United States Department of Health and Human Services that administers the Medicare program and works in partnership with state governments to administer...

(CMS) to undertake pilot projects which, if they are successful could be implemented in future.

Universal health care

The universal health care proposal pending in Congress is called the United States National Health Care Act (H.R. 676, formerly the "Medicare for All Act.") The Congressional Budget Office

Congressional Budget Office

The Congressional Budget Office is a federal agency within the legislative branch of the United States government that provides economic data to Congress....

and related government agencies scored the cost of a universal health care system several times since 1991, and have uniformly predicted cost savings, probably because of the 40% cost savings associated with universal preventative care and elimination of insurance company overhead costs.

Balancing doctor supply and demand

The Medicare Graduate Medical Education program regulates the supply of medical doctors in the U.S. By adjusting the reimbursement rates to establish more income equality

Economic inequality

Economic inequality comprises all disparities in the distribution of economic assets and income. The term typically refers to inequality among individuals and groups within a society, but can also refer to inequality among countries. The issue of economic inequality is related to the ideas of...

among the medical professions, the effective cost of medical care can be lowered.

Bundled payments

A key project is one that could radically change the way the medical profession is paid for services under Medicare and Medicaid. The current system, which is also the prime system used by medical insurers is known as fee-for-service

Fee-for-service

Fee-for-service is a payment model where services are unbundled and paid for separately. In health care, it gives an incentive for physicians to provide more treatments because payment is dependent on the quantity of care, rather than quality of care...

because the medical practitioner is paid only for the performance of medical procedures which, it is argued means that doctors have a financial incentive to do more tests (which generates more income) which may not be in the patients' best long term interest. The current system encourages medical interventions such as surgeries and prescribed medicines (all of which carry some risk for the patient but increase revenues for the medical care industry) and does not reward other activities such as encouraging behavioral changes such as modifying dietary habits and quitting smoking, or follow-ups regarding prescribed regimes which could have better outcomes for the patient at a lower cost. The current fee-for-service system also rewards bad hospitals for bad service. Some have noted that the best hospitals have fewer re-admission rates than others, which benefits patients, but some of the worst hospitals have high re-admission rates which is bad for patients but is perversely rewarded under the fee-for-service system.

Projects at CMS are examining the possibility of rewarding health care providers through a process known as "bundled payment

Bundled payment

Bundled payment, also known as episode-based payment, episode payment, episode-of-care payment, case rate, evidence-based case rate, global bundled payment, global payment, package pricing, or packaged pricing, is defined as the reimbursement of health care providers "on the basis of expected...

s" by which local doctors and hospitals in an area would be paid not on a fee for service basis but on a capitation system linked to outcomes. The areas with the best outcomes would get more. This system, it is argued, makes medical practitioners much more concerned to focus on activities that deliver real health benefits at a lower cost to the system by removing the perversities inherent in the fee-for-service system.

Though aimed as a model for health care funded by CMS, if the project is successful it is thought that the model could be followed by the commercial health insurance industry also.

2010 Patient Protection and Affordable Care Act details

Key provisions of the health-care legislation passed in March 2010 are:

Within one year of enactment (2010–2011)

Insurance companies barred from dropping people from coverage when they get sick, ending the practice of rescission
Rescission
In contract law, rescission has been defined as the unmaking of a contract between parties. Rescission is the unwinding of a transaction. This is done to bring the parties, as far as possible, back to the position in which they were before they entered into a contract .-In court:Rescission is an...

. Lifetime coverage limits eliminated and annual limits restricted.
Young adults able to stay on their parents' health plans until age 26. Many health plans previously dropped dependents from coverage when they turned 19 or finished college.
Uninsured adults with pre-existing conditions will be able to obtain health coverage through a new program for high risk pools that will expire once new insurance exchanges begin operating in 2014.
Insurance companies cannot deny group or new (non-grandfathered
Grandfather clause
Grandfather clause is a legal term used to describe a situation in which an old rule continues to apply to some existing situations, while a new rule will apply to all future situations. It is often used as a verb: to grandfather means to grant such an exemption...

) individual coverage to children under age 19 due to a pre-existing condition.
A temporary reinsurance program is created to help companies maintain health coverage for early retirees between the ages of 55 and 64. This also expires in 2014.
Medicare drug plan
Medicare Part D
Medicare Part D is a federal program to subsidize the costs of prescription drugs for Medicare beneficiaries in the United States. It was enacted as part of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 and went into effect on January 1, 2006.- Eligibility and...

beneficiaries who fall into the Medicare Part D coverage gap (the so-called "doughnut hole") will get a $250 rebate. The new law eventually closes that gap completely. (The old law required the sick person to pay 100% of their own annual medicine costs after $2,700 was spent in the coverage year and did not start again until after $6,154 was spent).
A tax credit becomes available for some small businesses to help provide coverage for workers.
A 10% tax on indoor tanning services that use ultraviolet lamps goes into effect on July 1.

Effective during 2011

Medicare provides 10% bonus payments to primary care physicians and general surgeons.
Medicare will cover the full cost of annual wellness visits and personalized prevention plan services for beneficiaries. New health plans will be required to cover preventive services with little or no direct cost to patients.
A new program under the Medicaid plan for the poor goes into effect in October that allows states to offer home and community based care for the disabled that might otherwise require institutional care.
Payments to insurers offering Medicare Advantage services are frozen at 2010 levels. These payments are to be gradually reduced to bring them more in line with traditional Medicare.
Employers are required to disclose the value of health benefits on employees' W-2 tax forms.
An annual fee is imposed on pharmaceutical companies according to market share. The fee does not apply to companies with sales of $5 million or less.

Effective as of 2012

Physician payment reforms are implemented in Medicare to enhance primary care services and encourage doctors to form "accountable care organization
Accountable care organization
An accountable care organization is a type of payment and delivery reform model that seeks to tie provider reimbursements to quality metrics and reductions in the total cost of care for an assigned population of patients. A group of coordinated health care providers form an ACO, which then...

s" to improve quality and efficiency of care.
An incentive program is established in Medicare for acute care hospitals to improve quality outcomes.
The Centers for Medicare and Medicaid Services, which oversees the government programs, begins tracking hospital readmission rates and puts in place financial incentives to reduce preventable readmissions.
New tax reporting changes were to come in effect to prevent tax evasion by corporations and individuals. However, in April 2011 President Barack Obama signed a bill repealing this provision, because it was burdensome to small businesses. Under the existing law, businesses have to notify the IRS on 1099 form of certain payments to individuals for certain services or property over a reporting threshold of $600. The requirement was going to be changed so that payments to corporations and individuals must also be reported. Originally it was expected to raise $17 billion over 10 years. The amendments made by Section 9006 of the Act were originally intended to apply to payments made by businesses after December 31, 2011, but will no longer apply because of the repeal of the section.

Effective as of 2013

A national pilot program is established for Medicare on payment bundling to encourage doctors, hospitals and other care providers to better coordinate patient care.
The threshold for claiming medical expenses on itemized tax returns is raised to 10% from 7.5% of income. The threshold remains at 7.5% for the elderly through 2016.
The Federal Insurance Contributions Act tax
Federal Insurance Contributions Act tax
Federal Insurance Contributions Act tax is a United States payroll tax imposed by the federal government on both employees and employers to fund Social Security and Medicare —federal programs that provide benefits for retirees, the disabled, and children of deceased workers...

(FICA) is raised to 2.35% from 1.45% for individuals earning more than $200,000 and married couples with incomes over $250,000. The tax is imposed on some investment income for that income group.
A 2.9% excise tax is imposed on the sale of medical devices. Anything generally purchased at the retail level by the public is excluded from the tax.

Effective as of 2014

State health insurance exchanges for small businesses and individuals open.
Individuals with income up to 133% of the federal poverty level qualify for Medicaid
Medicaid
Medicaid is the United States health program for certain people and families with low incomes and resources. It is a means-tested program that is jointly funded by the state and federal governments, and is managed by the states. People served by Medicaid are U.S. citizens or legal permanent...

coverage.
Healthcare tax credits become available to help people with incomes up to 400 percent of poverty purchase coverage on the exchange.
Premium cap for maximum "out-of-pocket" pay will be established for people with incomes up to 400 percent of FPL. Section 1401 of PPACA
Patient Protection and Affordable Care Act
The Patient Protection and Affordable Care Act is a United States federal statute signed into law by President Barack Obama on March 23, 2010. The law is the principal health care reform legislation of the 111th United States Congress...

explains that the subsidy will be provided as an advancable, refundable tax credit and gives a formula for its calculation. Refundable tax credit is a way to provide government benefit to people even with no tax liability (example: Child Tax Credit). According to White House and Congressional Budget Office figures, the maximum share of income that enrollees would have to pay for the "silver" healthcare plan would vary depending on their income relative to the federal poverty level, as follows: for families with income 133–150% of FPL will be 4-4.7% of income, for families with income of 150–200% of FPL will be 4.7-6.5% of income, for families with income 200–250% of FPL will be 6.5-8.4% of income, for families with income 250-300% of FPL will be 8.4-10.2% of income, for families with income from 300 to 400% of FPL will be 10.2% of income. In 2016,the federal poverty level is projected to equal about $11,800 for a single person and about $24,000 for family of four. See Subsidy Calculator for specific dollar amount.
Most people required to obtain health insurance coverage or pay a tax if they don't.
Health plans no longer can exclude people from coverage due to pre-existing conditions.
Employers with 50 or more workers who do not offer coverage face a fine of $2,000 for each employee if any worker receives subsidized insurance on the exchange. The first 30 employees aren't counted for the fine.
Health insurance companies begin paying a fee based on their market share.

Effective 2015

Medicare creates a physician payment program aimed at rewarding quality of care rather than volume of services.

Effective 2018

An excise tax on high cost employer-provided plans is imposed. The first $27,500 of a family plan and $10,200 for individual coverage is exempt from the tax. Higher levels are set for plans covering retirees and people in high risk professions.

Legal challenges

As Congressional approval neared, opponents of health care reform shifted from parliamentary and procedural opposition to challenge the constitutionality of the legislation. The Virginia General Assembly passed the Virginia Health Care Freedom Act before Congress completed action on its bill. Governor Robert F. McDonnell signed that law on March 24, prior to House approval of the reconciliation bill. The Virginia law prohibits any individual from being required to purchase health insurance. On March 17, 2010, Virginia Attorney General Ken Cuccinelli

Ken Cuccinelli

Kenneth Thomas 'Ken' Cuccinelli II is a U.S. politician and the Attorney General of Virginia. From 2002 until January 16, 2010 he was a Republican member of the Senate of Virginia, representing the 37th district in Fairfax County...

sent House Speaker Nancy Pelosi

Nancy Pelosi

Nancy Patricia D'Alesandro Pelosi is the Minority Leader of the United States House of Representatives and served as the 60th Speaker of the United States House of Representatives from 2007 to 2011...

a letter threatening constitutional challenge to the enactment of the bill if the House used a self-implementing rule and deemed the bill, which had begun in the Senate, to pass. On March 23, 2010, Cuccinelli filed Commonwealth v. Sebelius in the Federal District Court for the Eastern District of Virginia challenging the Constitutionality of the insurance requirement. Also on March 23, 2010, the Attorney General of Florida

Florida

Florida is a state in the southeastern United States, located on the nation's Atlantic and Gulf coasts. It is bordered to the west by the Gulf of Mexico, to the north by Alabama and Georgia and to the east by the Atlantic Ocean. With a population of 18,801,310 as measured by the 2010 census, it...

, together with the States of South Carolina

South Carolina

South Carolina is a state in the Deep South of the United States that borders Georgia to the south, North Carolina to the north, and the Atlantic Ocean to the east. Originally part of the Province of Carolina, the Province of South Carolina was one of the 13 colonies that declared independence...

, Nebraska

Nebraska

Nebraska is a state on the Great Plains of the Midwestern United States. The state's capital is Lincoln and its largest city is Omaha, on the Missouri River....

, Texas

Texas

Texas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...

, Utah

Utah

Utah is a state in the Western United States. It was the 45th state to join the Union, on January 4, 1896. Approximately 80% of Utah's 2,763,885 people live along the Wasatch Front, centering on Salt Lake City. This leaves vast expanses of the state nearly uninhabited, making the population the...

, Louisiana

Louisiana

Louisiana is a state located in the southern region of the United States of America. Its capital is Baton Rouge and largest city is New Orleans. Louisiana is the only state in the U.S. with political subdivisions termed parishes, which are local governments equivalent to counties...

, Alabama

Alabama

Alabama is a state located in the southeastern region of the United States. It is bordered by Tennessee to the north, Georgia to the east, Florida and the Gulf of Mexico to the south, and Mississippi to the west. Alabama ranks 30th in total land area and ranks second in the size of its inland...

, Michigan

Michigan

Michigan is a U.S. state located in the Great Lakes Region of the United States of America. The name Michigan is the French form of the Ojibwa word mishigamaa, meaning "large water" or "large lake"....

, Colorado

Colorado

Colorado is a U.S. state that encompasses much of the Rocky Mountains as well as the northeastern portion of the Colorado Plateau and the western edge of the Great Plains...

, Pennsylvania

Pennsylvania

The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...

, Washington, Idaho

Idaho

Idaho is a state in the Rocky Mountain area of the United States. The state's largest city and capital is Boise. Residents are called "Idahoans". Idaho was admitted to the Union on July 3, 1890, as the 43rd state....

and South Dakota

South Dakota

South Dakota is a state located in the Midwestern region of the United States. It is named after the Lakota and Dakota Sioux American Indian tribes. Once a part of Dakota Territory, South Dakota became a state on November 2, 1889. The state has an area of and an estimated population of just over...

filed a joint law suit in a Florida district court also challenging the new law.

Some Constitutional law

Constitutional law

Constitutional law is the body of law which defines the relationship of different entities within a state, namely, the executive, the legislature and the judiciary....

professors and commentators in the press have opined that the lawsuits and state laws are unlikely to succeed. However, other Constitutional law professors and other legal experts maintain that the health insurance mandate (the requirement that individuals purchase insurance, or face a penalty) is, in fact, unconstitutional.

On August 2, 2010, District Court Judge Henry Hudson, presiding over Virginia's lawsuit challenging the Obama administration's health care reform package, denied the Justice Department's attempt to have that lawsuit dismissed, stating that Virginia's case raises Constitutional issues - mainly whether Congress has the right under the Commerce Clause

Commerce Clause

to regulate and tax a person's decision not to participate in interstate commerce.

On December 13, 2010, U.S. District Judge Henry E. Hudson struck down part of the health care law. "In his 42-page opinion, Hudson concluded that requiring most people to get insurance or pay a fine - as the law mandates starting in 2014 - is an unprecedented expansion of federal power and cannot be justified under Congress's authority to regulate interstate commerce." .

Health reform and the 2008 presidential election

External links

HealthReform.gov official government site
Health Insurance Reform Reality Check official White House rumor control site
Health Care from WhiteHouse.gov

Directory
News media

Health Care in America from CNN
CNN
Cable News Network is a U.S. cable news channel founded in 1980 by Ted Turner. Upon its launch, CNN was the first channel to provide 24-hour television news coverage, and the first all-news television channel in the United States...
Health Care Hub from C-Span
C-SPAN
C-SPAN , an acronym for Cable-Satellite Public Affairs Network, is an American cable television network that offers coverage of federal government proceedings and other public affairs programming via its three television channels , one radio station and a group of websites that provide streaming...
Health Care Reform & YouTube from Governing Dynamo, includes nearly all White House videos on health care reform
Health Care Reform collected news coverage from The New York Times
The New York Times
The New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...
Prescriptions for Change collected news coverage from NPR
NPR
NPR, formerly National Public Radio, is a privately and publicly funded non-profit membership media organization that serves as a national syndicator to a network of 900 public radio stations in the United States. NPR was created in 1970, following congressional passage of the Public Broadcasting...
Pros and cons of universal health care in the United States, Journalists collecting information about the pros and cons of universal health care
Healthcare Reform collected news coverage from Reuters
Reuters
Reuters is a news agency headquartered in New York City. Until 2008 the Reuters news agency formed part of a British independent company, Reuters Group plc, which was also a provider of financial market data...
Health-Care Reform 2009 collected news coverage from The Washington Post
The Washington Post
The Washington Post is Washington, D.C.'s largest newspaper and its oldest still-existing paper, founded in 1877. Located in the capital of the United States, The Post has a particular emphasis on national politics. D.C., Maryland, and Virginia editions are printed for daily circulation...
In Search of Health Care Reform interactive overview
Health Systems and reform, a special program of the World Association for Medical Law
World Association for Medical Law
- Medical Law:Medical Law concerns the rights and duties of the medical profession and is thus directly linked to the field of medical ethics. [1]Some consider medical law a scientific discipline [1] closely related to the advancement of health related technology over the last 50 years...

Financial information

Congressional Budget Office official government site
Estimated Impact of Health Care Reform Proposals from the Centers for Medicare and Medicaid Services
Centers for Medicare and Medicaid Services
The Centers for Medicare & Medicaid Services , previously known as the Health Care Financing Administration , is a federal agency within the United States Department of Health and Human Services that administers the Medicare program and works in partnership with state governments to administer...
Office of Management and Budget official government site
Kaiser Family Foundation: Health Reform Subsidy Calculator—Premium Assistance for Coverage in Exchanges/Gateways

The source of this article is wikipedia, the free encyclopedia. The text of this article is licensed under the GFDL.

History of national reform efforts

The 2010 Federal Reform Legislation

Expanding Medicaid and subsidizing insurance

Guaranteed issue, community rating, individual mandate

Efficacy of health insurance

Reduce the deficit

Eliminate overpayment in Medicare Advantage

Political positions of the main parties

Lobbying

Possible future reforms

Universal health care

Balancing doctor supply and demand

Bundled payments

2010 Patient Protection and Affordable Care Act details

Within one year of enactment (2010–2011)

Effective during 2011

Effective as of 2012

Effective as of 2013

Effective as of 2014

Effective 2015

Effective 2018

Legal challenges

Health reform and the 2008 presidential election

See also

Books

Articles and links

External links