Cost of reform

Misty Bell | May 01, 2010

In the past few months, health-care reform has proved to be one of the most polarizing topics in recent U.S. history. But how much should you care about it, and how will it affect you?

According to my research, some of the effects will be felt almost immediately. According to a column by Rep. John B. Larson (D-Conn.) published online in the Huffington Post, within the first six months after its passage, the bill will prevent children from being excluded from coverage because of preexisting conditions and also provide an opportunity to be covered for adults who’ve been unable to get insurance because of preexisting conditions. It also will reduce prescription costs for the elderly and offer tax credits to small businesses, among other things.

For many Americans, the most important long-term effect will be the requirement to either attain insurance coverage or pay a fine, which should take effect in 2014. The bill is projected to expand coverage to 32 million currently uninsured Americans, primarily through insurance “exchanges” designed to drive down the cost of insurance by making the market more competitive. It will require businesses with more than 50 employees to either provide insurance coverage for their employees or pay an annual per-worker fine to the government. Uninsured and self-employed people would be eligible for assistance in paying insurance premiums if they fall into a low enough income bracket (up to 400 percent of the Federal Poverty Level, which is $22,050 for a family of four — so up to about $88,200 annual income for a family of four) and are not eligible for Medicare or Medicaid.

The end goal is certainly admirable, and the benefits are there for people with preexisting conditions or who meet certain income criteria. The legislation also likely will prove helpful to those who are self-employed, such as our owner-operator readers. Those who will benefit most from the legislation will likely be those who were unable to attain or afford insurance coverage before.

So where does that leave the rest of us? According to an interactive tool on washingtonpost.com, for a middle-class family of two (which represents my current family situation), no new taxes would be levied, but insurance coverage would be required, with a penalty for failure to comply. For those in a similar situation, tax credits will be available when the consumer pays more than 9.5 percent of the family income on premiums, and assistance with deductibles and co-pays will be provided. There will be an annual cap of $4,750 for premiums and 30 percent of total cost for deductibles and co-pays. (For a list of helpful health-care reform-related sites, visit www.fit4theroad.com.)

The intangibles of the situation are the effects the reform will have on the health-care system in the United States. On one side of the coin, many argue that the reform plan will irreparably damage the system, cause hospitals to become overwhelmed with the previously uninsured and drive the best doctors into private practice. On the other side, the argument is that better coverage for everyone should mean a better system for everyone, with an emphasis on prevention.

While reform is a good idea, it remains to be seen whether this will actually work. Unfortunately, it relies heavily on cooperation from all involved, and while it helps to provide insurance coverage for those who need it most, does it do so at the expense of the rest of us?

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