Health Care Reform Passes Congress

On Sunday, March 21, 2010, the House of Representatives approved H.R. 3590, the Patient Protection and Affordable Care Act by a vote of 219 to 212. Following that vote, the House adopted H.R. 4782, the reconciliation package, which makes a number of changes to H.R. 3590, by a vote of 220 to 211. H.R. 3590 will now go to President Obama for his signature and enactment into law. H.R. 4782 will be sent to the Senate.

The rules of reconciliation require there to be twenty hours of Senate debate as well as consideration of amendments. Although the Senate Democratic Leadership and President Obama would like the Senate to complete action on the reconciliation package by the end of the week. Senate Majority Whip Richard Durbin (IL) has suggested that, although they have the 51 votes necessary to approve the bill, the Senate may not meet the weeks-end objective.

Senate Minority Leader Mitch McConnell (KY) has stated that Republicans plan to offer amendments on substance, with expected topics including medical liability, the individual mandate and the Medicare payment reductions. Republicans also will raise points of order against various provisions in the bill that may violate reconciliation rules. If the Senate adopts any changes to the reconciliation package, the measure will go back to the House for consideration, as such the Democratic Leadership is hoping to keep the bill “clean.”

Although the Senate expects to adopt the Reconciliation Bill, President Obama will first sign into law H.R. 3950, which includes the following provisions;

  • FSA Cap of $2,500 effective January 2011 and indexed to CPI
  • OTC limitation of medicines and drugs (i.e., to require a physician recommendation) effective January 2011
  • High-Cost Plan Excise Tax with thresholds set at $8,500 for individuals and $23,000 for families effective January 2013 and indexed to CPI+1 percentage point

Upon adoption of the Reconciliation Bill, the effective date of the required changes above will be extended.

Other provisions of the legislation include:

  • it bars health insurance companies from denying coverage to individuals with pre-existing conditions — the ban takes effect for children six months after enactment, and for all others starting in 2014
  • within six months after enactment, it will prohibit health insurance companies from dropping people from coverage when they get sick;
  • it bans health insurance companies, within six months after enactment, from placing lifetime caps on coverage
  • it begins to close the Medicare Part D coverage gap for Medicare beneficiaries who have surpassed their prescription drug coverage limit
  • it requires individuals to carry insurance or pay a penalty that would be the greater of $750 or 2 percent of income by 2016
  • companies with 50 or more employees will be required to help offset the cost of insurance for their employees if taxpayers are footing the bill for those workers’ insurance;
  • it establishes 50 state-administered insurance marketplaces to allow small businesses and people without employer sponsored coverage to buy insurance that meets new federal standards; and
  • it expands Medicaid to cover everyone earning less than 133 percent of the federal poverty level, or $29,327 for a family of four

Stay tuned for changes as they happen over the next 4 years………….

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