I have been taking the time to 1) listen and 2) read about the details of the Health Care Reform Act - distortions and fact alike. So, with the Legislature still on vacation and battling out fact from fiction in Town Hall Meetings, I thought I would take some time to share some of the good, bad and ugly of this bill which is very, very similar to the one Massachusetts enacted a few years ago.
I will address a few of the easy, straight-forward facts first.
- Similar to Massachusetts reform, the House version of the bill eliminates the ability of insurance companies to exclude potential customers or cancel customer policies due to pre-existing conditions UNLESS you lie to them. They may only cancel your policy for lack of payment and even that has a restriction with a grace period of about 30 days.
- In addition, the bill disallows inordinate premium increases to customers because of history or onset of a new condition. They may not increase the premiums of one person in a group; they must increase premiums for the entire risk group.
- They may of course charge based on plan benefits which for the public option will be classified in three categories, essentially: basic, enhanced, and premium.
- The public option, like the Massachusetts will calculate rates based on zip-code which is part of how private insurers currently calculate rates. For example, at one point when I was a benefits administrator, Greenwich, CT had the highest "reasonable and customary" allowable charges in the country. This was in the days of major medical plans - when we all paid low deductibles and were reimbursed at rates described as 80/20 or 90/10 (they paid 80%, we paid 20% up to an annual maximum). These days, providers negotiate contract reimbursement rates and we pay a copayment or coinsurance either with or without a deductible. I have not found these details yet but I am still reading the document.
- There will be a phase in period much like there has been in Massachusetts. I have read a 3-5 year phase in proces in different parts of the document so far. This allows for grandfathering of some non-compliant plans for a period of time - also much like the Massachusetts bill.
- Annual and lifetime maximums will be banned.
- Methods of coinsurance will also be banned, leaving only customer-friendly, easy to understand methods copayment methos.
I will keep reading and come back with some more basics soon.