Key Provisions of the New Patient Protection and Affordable Care Act
I seem to be caught in an alarming pattern in which every time I leave the country, I return to fiscal and/or political turmoil. In September of 2008, for example, I departed to St. Lucia for a week and arrived back into the eye of the Wall Street collapse; Lehman Brothers had filed for bankruptcy, Fannie Mae and Freddie Mac had been placed in conservatorship, and general chaos reigned.
On Monday, I returned from a week in lovely Cabo San Lucas, Mexico in the wake of one of the most significant – and controversial – pieces of health care legislation in U.S. history. With the historic Patient Protection and Affordable Care Act (“PPACA”) now law and passage of the Reconciliation Bill looming (as of the time of this post, the bill had passed both the House and Senate and is awaiting President Obama’s signature), sweeping changes are scheduled to unfold during the next several years.
Some of the key provisions are as follows:
- Immediately, the Act will give small businesses a tax credit to help them pay for health insurance. Seniors will get a $250 rebate on prescription drug expenses. The federal government will begin providing significant funding to community health centers, eventually doubling the number of patients treated at these centers. The federal government will also provide funding to train additional primary care physicians, nurses and public health professionals to meet the increased demand for health care services.
- Within the next ninety days, individuals with pre-existing conditions will be able to purchase subsidized health insurance. Retiree health plans covering early retirees (ages 55 to 64) will qualify for a new federal reinsurance program which will reduce the costs of these plans, helping many Michigan businesses.
- In six months, all health plans will be prohibited from denying benefits to children because of pre-existing conditions or canceling coverage or a policy when a patient becomes sick or reaches a lifetime limit. Health plans will be required to permit young adults up to age 26 to remain on their parents' insurance policies. All new health plans will be required to provide free preventive care with no co-pays or deductibles.
- Beginning January 1, 2011, all insurance plans will be required to spend at least 80 percent of their revenues on paying claims. If an insurer spends too much on overhead, the insurer will be required to rebate some of the insurance premiums it collected.
- Many other significant changes will be made when Michigan's health insurance exchange is launched. Michigan residents and small businesses will be able to purchase insurance from the exchange at affordable rates. Michigan has until 2014 to launch this exchange. Once the exchange has been launched, no one can be denied insurance based on a pre-existing condition.
For a list of employer-specific considerations, please visit the linked article by FHWN attorney Michael Hamblin.
During the next weeks, the Health Care Lawyer Blog will continue to provide updates and details on the new PPACA, including new measures to fight "behavioral waste", new whistblower protection provisions, and amendments to the federal False Claims Act.
