On Wednesday (9/23/10), the sixth month anniversary of the new healthcare reform act will be reached. Many of the law’s provisions will take effect on that date though most insured persons won’t see any change to their specific health plan until January 1. Should a plan have an anniversary date between the 23rd and January 1, then those changes will take effect with that anniversary date.
For most people what is important is that between now and December 31st, many of you will be completing enrollment selections during their Open Enrollment periods in anticipation of their new plan year. Individual policy holders may be reviewing new options and pricing and Medicare recipients will have their open enrollment elections to consider during this period as well. Two new protections will take effect on the 23rd, lifetime limits on coverage will be removed from existing plans and adult children up to the age of 26 will be allowed to remain or be added to your coverage if they do not have coverage through an employer.
If your current plan of coverage has had significant changes since the law’s enactment, benefit reductions or increased out-of-pocket costs, your coverage may include a wider set of consumer protections. One area of the new healthcare law will extend preventive services such as breast cancer screenings and cholesterol testing without deductibles or co-payments being required. Use of obstetrician and pediatrician services will also be excluded from precertification requirements and recommended immunizations must be provided at no cost to the insured. These added protections would be included if your employer offers a new plan as alternative coverage to your existing plan(s).
However, these added coverage protections will not necessarily be free from added cost. It is expected that employers will make changes to their contribution costs for their employees. Increased payroll deduction costs are anticipated from most employers in this recessionary economy. Based upon the Kaiser Family Foundation (Health Research & Educational Trust), workers are already paying an additional $482 more for family health insurance coverage in 2010 than in 2009 or 14% more. This cost shifting in premium cost is expected to continue, even though additional out of pocket costs may be reduced under the healthcare law provisions.
For individual policyholders, insurers will be prevented from “rescinding” or cancelling your coverage once you are sick (except where fraud was present in the application process), lifetime limits will also be removed and you will be allowed to retain your adult children on your coverage up to their 26th birthday. New policies will not be allowed to deny coverage for preexisting conditions up to the age of 19 and preventive services will be covered. Plans that are considered to be “grandfathered” will still be allowed to set limits on coverage, continue to enforce preexisting limitations denials and require cost sharing on preventive services, though these plans are expected to fade away as plan provisions are amended or as people select new policies between now and 2014.
For Medicare recipients with standard Medicare coverage, benefits will be expanded. The prescription drug gap that is now present under Part D will begin to be reduced. Beginning in 2011, Medicare beneficiaries will receive a 50% discount for brand name drugs and a 7% discount for generic drugs while they are in the “gap”. In 2011, Medicare beneficiaries will also have co-payments or deductibles removed for many preventive services such as diabetes or cervical cancer screenings. An annual wellness visit to their doctor will also be paid for under coverage. However, if you are in a Medicare Advantage plan, your coverage may be affected by the new law. The law has reduced or eliminated reimbursements to the insurance carriers providing Medicare Advantage plans and ancillary benefits such as eyeglass care and gym memberships may be eliminated. Basic Medicare benefits are not affected under the Advantage plans, but the “advantage” for remaining in these plans may not be as significant in future years.
While many of the provisions of the healthcare law will take effect in the years after 2014, September 23rd is the effective date for the start of the healthcare overhaul as written and enacted by Congress in March 2010. It should be noted that all of the changes that take effect on Wednesday are insurance reforms and unfortunately do not address the actual cost of health care service provided and charged by medical providers.