Obama Care Consumer Protection 2010

Tuesday Tips is a series of articles from local experts to help you save money, make better decisions and plan for a better future.

Here are the highlights of the insurance coverage requirements as of September 23, 2010

• Increase Dependent Age for Policies through Age 26: Allows those through age 26 not otherwise covered to remain on their parents’ policies at their parents’ discretion.
• Doughnut Hole Help: Seniors will get a $250 rebate to help fill the “doughnut hole” in Medicare prescription drug coverage, which falls between the $2,700 initial limit and when catastrophic coverage kicks in at $6,154.
• Ban on Lifetime Limits: Lifetime limits on the dollar value of insurance coverage will be prohibited. This refers to how much your insurance coverage pays out to cover claims. Therefore, families with premature children, children with serious illnesses, or any adults needing extended hospital care or surgery will be able to continue to receive health care.

• Ends Health Insurance Rescissions: Insurers will be prohibited from rescinding or canceling coverage except in cases where the customer commits fraud. (Prohibits abusive practices whereby health insurance companies rescind existing health insurance policies when a person gets sick as a way of avoiding covering the costs of enrollees’ health care needs.)
• Children Cannot be Excluded: Insurers will not be able to exclude children from coverage because of a pre-existing condition, but they can require parents to sign up kids only during a fixed annual enrollment period to ensure they don’t wait until a child gets sick to buy coverage.
• Adults Cannot be Excluded: Adults who were previously denied insurance due to pre-existing conditions can no longer be denied health coverage.
• Ensuring Reconstructive Surgery for Children: Requires plans to pay for reconstructive surgery for children with deformities.
• Preventive Care Required: Insurers will be required to provide preventive care like immunizations or mammograms without charging co-pays or other forms of cost sharing. (Some may not have to comply with this element if their coverage existed March 23 and has not changed substantially. All plans must comply by 2018.)
• New Limits On Pre-Existing Condition Exclusions: Prior to the bill’s complete prohibition on preexisting condition exclusions beginning in 2013, reduces the window that plans can look back for pre-existing conditions from 6 months to 30 days and shortens the period that plans may exclude coverage of certain benefits. It also prohibits insurers from limiting or denying coverage based on acts stemming from domestic violence.
• Ensuring Value (Medical Loss Ratio): Specifies that health plans spend a minimum of 85 percent of premium dollars on medical care, while making sure that such a change doesn’t further destabilize the current individual health insurance market.
• Limitation on Post-Retirement Reductions Of Retiree Health Benefits: Prohibits employers from reducing retirees’ health benefits after those retirees have retired, unless the reduction is also made to benefits for active participants.
• Creates Reinsurance For Early Retirees: Creates a new temporary reinsurance program to help offset the cost of coverage for companies that provide early retiree health benefits for those ages 55-64.

These changes in the health care reform bill focus on consumer protections. More to come….

Joseph Reisman, of Joseph S. Reisman & Associates, has been serving tax prep and business accounting expertise from his Coney Island Avenue office for more than 25 years. Check out the firm’s website.