Senate Health Care Bill Summary, Leaked

The Senate Health Care Bill has not yet been published, but a summary of the bill has been leaked.   The bill is probably passable with minor adjustments and lobbying efforts.  It will likely get the universal support of conservative Democrats, even some Republicans.  Those numbers will probably be larger than the number of defecting liberal Democrats who will undoubtedly be against the bill.  (Having Liberal Democratic objection, even boisterous at times, is a smart political move to gain Centrist support.)

I have argued since the introduction of HR3200 that the reason for the quick legislation was not about true reform, but rather addressing two issues that can’t be openly discussed in Washington. (ref:  Why is this happening now, so quickly? Is there a secret? 7/17/09). Those reasons?  A tax increase and rescission of the Medicare Revitalization Act of 2003, MRA 2003 was designed to slow medicare growth rates.  

Here are the two items that start in 2010: 

  • The scheduled 21% reduction in Medicare physician payment rates in 2010 would be replaced with a 0.5% increase. 
  • Big Business Fees – Clinical Labs: $750mm per year fee,  Big Pharma: $2.3 billion per year,  Medical Device Mfg.: $4 billion per year,  Health Insurance companies: $6 billion per year. 

Highlights of the rest of the bill, with specific interest to those with group or individual insurance plans, starting in 2013:

  • It will make individual insurance guarantee-to-issue in 2013. 
  • Fines for individuals without insurance starting in 2013.  Up to $3800 per family. 
  • Age control pricing: – no more than 500% variance from age 20 to age 64. 
  • Group pricing band mandates: – (1-50 ee’s) changes phased in over 5 years starting in 2013.   9 year phase in for groups of 50-100. 
  • 2 year tax credit for groups with less than 25 employees.   Up to 50% of cost. 
  • Employers with more than 50 employees not offering coverage pay $400 fee, per employee. 
  • Employers with more than 200 employees must enroll the member in their health plan unless other coverage can be proven. 
  • 35% Surtax on group medical benefits providing more than $8000 per individual, $21,000 per family.  Value of benefits will be disclosed on w-2.
  • Cross State Exchange to purchase coverage for individuals starting in 2015. 
  • Standardized benefit minimums.
  • Standardized coinsurance plans, from 65% minimum to 90% maximum. .Plus a “young invincible” plan to allow for low-cost coverage for young people.  
  • Maximized out of pocket limits not to exceed HSA limits. 
  • Co-ops – to allow buying power.  Incentives and funding for non-profits to form co-ops.
  • Medicare Advantage Plans remain.
  • HRA, HSA, and Flex Spending Accounts limited to $2000 max.  
  • Penalty on using HSA money for non medical expenses increased from 10% to 20%.

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