Value of Health Reform About to Become Apparent

Starting today, health reform will make it possible for everyone with pre-existing conditions to obtain health insurance, and insurers must offer coverage to all children under 18, even if they have a pre-existing condition.
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Six months ago, the health care reform law was signed into law. The Affordable Care Act brings an expansion of benefits for most Americans with health insurance and coverage for millions of Americans who lack health insurance today. As some of these benefits start to kick in today (September 23), the value of health reform will become increasingly apparent to millions of Americans.

Health reform will make it possible for the 125 million Americans with pre-existing conditions, such as diabetes or cancer, to obtain health insurance. Starting today, insurers must offer coverage to all children under 18, even if they have a pre-existing condition. They must also offer coverage to Americans under age 26 through their parents' coverage, if they do not have their own employer-sponsored insurance. Adults with pre-existing conditions and no insurance can join a high risk pool in their state.

Health reform also stops insurers from dropping people from coverage simply because they develop an illness or need too much care. Before the new health care law passed, insurers could drop people from coverage once they fell ill. Insurers also could put limits on how much money they would spend on people's care during their lifetimes, and many people with serious chronic conditions were dumped when they became too expensive. Now these patients will continue to be covered.

Health reform also reins in health care spending for individuals. For example, working-age Americans will not have to pay anything out of pocket for preventive services such as mammograms. Older adults and people with disabilities with Medicare coverage who are heavy users of prescription drugs will get a $250 check from the government to help them pay their drug bills. Childless adults with low incomes will finally be able to get coverage through Medicaid in their states. Low and moderate income individuals who do not have coverage through an employer will get help paying for their health insurance on a sliding scale. Businesses will get financial assistance to provide health benefits to their retirees over 55 years old who do not qualify for Medicare.

Last week the U.S. Census Bureau announced that more than 50 million people, or 1 out of every 6 Americans, did not have health coverage in 2009 -- an increase of 4 million from the year before. The Affordable Care Act is expected to cover 32 million of these 50 million Americans by 2014.

There are cost containment provisions. Insurers must justify their premium increases and may have to reduce them if they are excessive. Beginning in 2011, insurers cannot spend more than 20 cents of every premium dollar on administrative services and profits; the rate of increase that the Medicare program will pay for goods and services is reduced; and the price the Medicaid program will pay for drugs drops.

There's still more in 2011. The government will try different approaches to reduce the number of malpractice claims; primary care doctors will get a 10 percent raise; people with Medicare in the "donut hole," waiting for their drug benefit to kick back in, will see the price of the brand name drugs by 50 percent, and new community-based services will be available to them.

A recent survey conducted by the Kaiser Family Foundation discovered that a majority of Americans believe that the law will be successful or very successful in lowering health care costs, expanding coverage, improving quality of care and regulating health insurers. As the provisions take effect on September 23rd, the popularity of the legislation is likely to increase.

Gerard F. Anderson, PhD, is a professor of health policy and management at the Johns Hopkins University Bloomberg School Public Health.

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