With the House passage of the Senate version of the Patient
Protection and Affordable Healthcare Act
Congress took a huge step
toward passage of comprehensive health care reform. Even though the
bulk of the reform bill was signed into law, it still has a second part,
the Reconciliation Act of 2010
, which deals with some important
things like a new tax on “investment income” to help pay for this
massive program. Here’s what the process looked like and what it might
mean for you and our practice of emergency medicine.
In the first vote, the House passed (by a recorded vote, not by the "deeming" process as originally planned) the identical language of the Senate healthcare bill, the Patient Protection and Affordable Healthcare Act. The vote passed by a margin of 219-212 with 178 Republicans and 34 Democrats voting against the bill. The House then passed (by a 220-211 vote) H.R. 4872 — the Reconciliation Act of 2010, which comprised 153 pages of amendments to the Senate core bill. By passing the two bills separately this allows the core Senate bill to be sent to the President for signing. At the same time, the language of the Reconciliation Act of 2010 is now referred back to the Senate for consideration by that body. Because the House passed the Reconciliation Act of 2010 as a "budget reconciliation" bill, the Senate Parliamentarian must now rule whether or not all of the amendments included in the bill meet the more stringent rules in the Senate on this issue.
Here's a few possibilities of what happens now. If the Senate Parliamentarian decides that all of the amendments can be included under the budget reconciliation rule, then the Senate will vote the entire package up or down by a simple majority. If the Parliamentarian determines that some (or even one) of the amendments are not allowable, then the Senate has a few options. First, the Senate could pass all of the allowable amendments under the budget reconciliation rules and then send that bill back to the House and give up on the non-allowable amendments. Second, the Senate could pass the allowable amendments under budget reconciliation rules and try to pass the non-allowable amendments under the standing rules of the Senate subject to supermajority cloture/filibuster votes. Third, the Senate could opt not to take up the reconciliation amendment at all and just let their original core bill remain the final law.
With the signing of the bill (PPAHA) by the President, it immediately set into place a number of changes in how the healthcare system will work. Although if the Senate passes the reconciliation amendments will change some aspects of the law, the basics are as follows.
IMMEDIATE CHANGES: 2010
SMALL BUSINESSES: with fewer than 50 employees will receive tax credits covering 35% of premiums, to help them afford coverage. By 2014, that will rise to 50%.
SENIORS: get a $250 rebate to help fill the "doughnut hole" in Medicare drug coverage.
NEXT YEAR: 2011
- are required to let young people stay on their parents' policy up to their 27th birthday.
- will be barred from denying coverage to kids with pre-existing conditions. Adults will have to wait until 2014 for the same protection. But high-risk pools will offer an option for affordable coverage until then.
- can't place lifetime caps on benefits any longer.
- New private plans must cover checkups and other preventive services with no co-pays. By 2018, all plans must comply.
Drug Companies and Medical Device Manufacturers: Drug makers must pay new fees, starting at $2.7 billion. Insurance and medical-device providers follow in 2013. Three years: 2013
TAXES: Medicare payroll taxes increase - from a rate of 1.45% to 2.35% - for singles earning more than $200,000 a year and families above $250,000. Four years: 2014
- INDIVIDUAL MANDATE: Individuals not covered by a company policy will be required to get insurance or face a fine - $95 in 2014, $325 in 2015 and $695 in 2016 (with a maximum of $2,250 for a family). There is an exemption for low-income people.
- EMPLOYER MANDATE: Businesses with 50 or more employees must offer insurance or pay a $2,000-per-worker penalty.
HEALTH CARE EXCHANGES: These new state-based marketplaces should be open for business, giving individuals and small businesses a place to shop for affordable insurance.
SUBSIDIES: To help pay for insurance, the feds will offer subsidies to families making as much as $88,000 a year. Out-of-pocket spending will be tied to a person's income and kept as low as $1,000.
EIGHT YEARS OUT: 2018
TAX ON HIGH-COST HEALTH PLANS: A 40% excise tax will be slapped on high-cost "Cadillac" plans starting in 2018. Ten years: 2020- Medicare: Benefits that began to close Medicare's "doughnut hole" for prescription drugs in 2010 will finally complete the job in 2020.
WHAT THIS REFORM WILL MEAN FOR EMERGENCY MEDICINE
More patients we care for in the Emergency Department will have insurance...through increased coverage of dependents, a ban on dropping kids (and later adults) with pre-existing conditions, a ban on coverage limits, and increases in coverage through Health Care Exchanges, Medicaid and CHIP. Changes will occur in payments for Medicare services....the bill counts on reductions of Medicare expenditures of greater than $400 billion dollars. How these savings will occur has not been completely detailed, but there will be increased activity to recover money under the banner of Fraud, Waste, and Abuse. How will private insurers keep premiums down while increasing coverage and reducing expenditures is also still to be seen.
Your taxes may go up. If your combined family income is more than $250,000 or individual income is more than $200,000 you will see increases in your Medicare tax bill from 1.45% to 2.35% of your Medicare taxable income. And …if you make any money through dividends, interest, property sale, or any other similar income generator…that money will be subject to a 3.8% tax.
Your reimbursement under Medicare will not go up, at least not right away. The core bill (and the reconciliation bill) do not fix the SGR problem of the Medicare Payment system. It is unclear when Congress will act on this issue. Keeping in mind that the price tag for the "physician fix" is ~ $210 billion, there will be reluctance to pass a bill that will add to the federal deficit. Despite the uncertainty of what all this might mean, the passage of healthcare reform presents opportunities for emergency medicine physicians to be involved in defining quality standards used by CMS and in ensuring that new payment mechanisms provide appropriate reimbursement for the care we provide as the safety net to all Americans. Promise to stay engaged in the process, or get involved now...your practice and future still depend on your voice being heard.