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Monday, April 12, 2010

Kaiser Headline News

Kaiser Health News - Apr. 6: Consumers and employers who provide health insurance are scrambling to understand what will change in their premiums and benefits once provisions of the recently passed law go into effect.Unlike state insurance laws, which mostly affect policies individually purchased or offered through small and mid-sized businesses, the new federal legislation applies more broadly to nearly all types of private plans, say insurers and employer benefit experts. That includes policies offered by large self-insured employers, through whom about half of the nation’s covered workers get their insurance. Some new rules such as barring insurers from rejecting children with medical conditions or from canceling policies retroactively are aimed at problems that mainly affect the 17 million people who buy their own insurance in the so-called non-group market.But even the approximately 175 million Americans who get group coverage through their jobs will see changes.
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It will be up to the HHS secretary, for example:* To define the breadth of coverage in an "essential benefits package." * To determine how insurers will calculate how much they spend on direct medical care, a key point because insurers who don’t meet specific spending benchmarks must issue rebates to consumers.An HHS spokesman would not provide any details on when regulations will be issued. But, with some provisions set to go into effect by the end of September, pressure is on to move quickly.Among the unknowns is the effect on premiums in the next couple of years. New taxes on drug companies, device makers and insurers don’t begin until at least 2012. But when they do, many economists expect that the increases will be passed along to employers and consumers. Barring insurers from setting lifetime coverage limits may also put upward pressure on premiums.Over time, however, the Congressional Budget Office has estimated that some of the new rules – such as the creation of an online marketplace for insurance purchases – could result in savings that may slow premium growth for some types of coverage.By 2016, when the law is expected to be fully implemented, the CBO estimated that large employers would not be paying more in premiums than they would have done without the new law. That same year, small employers and their workers might see a slight decrease in premiums or up to a 1 percent increase, the CBO said. Individuals could see premium increases of 10 percent to 13 percent, mainly because the coverage purchased would be more comprehensive than what is often purchased in today’s market. For about half of the people buying their own coverage, those increases would be offset by federal subsidies, the CBO said.

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