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Archive for October, 2010

Many health care reform provisions went into effect on September 23, but as with any new law some will start right away, and others will slowly be implemented over time.

Small business tax credits for companies with fewer than 25 employees are now in effect. Provisions to rescind policies are banned. People now are afforded federally protected appeals rights.
Some provisions are not welcome by the insurance industry and are being challenged in their own way. For example, insurers are now prohibited from denying coverage for children with pre-existing medical conditions. Insurance companies have responded by eliminating children’s policies in several states.
The ugly duckling, known as the medical loss ratio, is being legislated at 80% for small groups and 85% for large groups with a mandated rebate if the insurer fails to meet these ratios. Insurance companies have responded by reclassifying certain expenses as medical services.
Although other provisions are already in effect, such as dependent coverage for adult children up to age 26 for all policies, and requiring qualified health plans to provide minimum coverage for certain preventive services without cost sharing, these will only start when policies are renewed. In many instances, this will be in January 2011.
Interstate insurance exchange programs should already be in place, but they are running far behind schedule. The federal government does not know how to run them and state programs are so different from each other that most states have decided not to run their own.

Most states estimate serious financial shortfalls in this program; therefore they are hesitant to get it started.

Medicare changes are taking effect as well, such as cuts in all hospital payment rates, payment reduction to Medicare Advantage plans and a significant start in eliminating the prescription coverage gap.