Health care timeline: Implementing the changes

Parts of the health care plan won’t be fully phased in for a decade, but ultimately 94 percent of eligible Americans would have coverage.

THIS YEAR

Sets up a high-risk health insurance pool to provide affordable coverage for uninsured people with medical problems. Starting six months after enactment, requires all health insurance plans to maintain dependent coverage for children until they turn 26.

For children with medical problems, prohibits insurers from writing a policy that excludes payment for the particular condition. Insurers in the individual market could still deny new coverage to children in poor health. Bars insurance companies from putting lifetime dollar limits on coverage and canceling policies, except in cases of fraud.

Provides tax credits to help small businesses with up to 25 employees get and keep coverage for their employees. Begins narrowing the Medicare prescription coverage gap, or “doughnut hole,” by providing a $250 rebate to recipients in the gap, which starts this year once they have spent $2,830. It would be fully closed by 2020.

Reduces projected Medicare payments to hospitals, home health agencies, nursing homes, hospices and other providers. Imposes a 10 percent sales tax on indoor tanning.

2011

Creates a voluntary long-term-care insurance program to provide a modest cash benefit helping disabled people stay in their homes or cover nursing-home costs. Benefits can begin five years after people start paying a fee for the coverage.

Provides Medicare recipients in the prescription coverage gap with a 50 percent discount on brand-name drugs; begins phasing in additional drug discounts to close the gap by 2020.

Provides a 10 percent Medicare bonus to primary-care doctors and general surgeons practicing in underserved areas, such as inner cities and rural communities; improves preventive coverage.

Freezes payments to Medicare Advantage plans, the first step in reducing payments to the private insurers who serve about one-fourth of seniors. The reductions would be phased in over three to seven years.

Boosts funding for community health centers, which provide basic care for many low-income and uninsured people. Requires employers to report the value of health care benefits on employees’ W-2 tax statements.

2012

Sets up a program to create nonprofit insurance co-ops that would compete with commercial insurers.

Initiates Medicare payment changes by encouraging hospitals and doctors to band together in quality-driven “accountable care organizations” along the lines of the Mayo Clinic. Sets up a pilot program to test more efficient ways of paying hospitals, doctors, nursing homes and other providers who care for Medicare patients from admission through discharge. Successful experiments would be widely adopted.

Penalizes hospitals with high rates of preventable readmissions by reducing Medicare payments.

2013

Standardizes insurance company paperwork, the first in a series of steps to reduce administrative costs.

Limits medical expense contributions to tax-sheltered flexible spending accounts to $2,500 a year, indexed for inflation.

Raises the threshold for claiming an itemized tax deduction for medical expenses to 10 percent from 7.5 percent of income.

People older than 65 can still deduct medical expenses above 7.5 percent of income through 2016.

Increases the Medicare payroll tax on couples making more than $250,000 and individuals making more than $200,000.

The tax rate on wages above those thresholds would rise to 2.35 percent from the current 1.45 percent.

Also adds a new tax of 3.8 percent on income from investments.

Imposes a 2.3 percent sales tax on medical devices. Eyeglasses, contact lenses, hearing aids and many everyday items bought at drugstores are exempt.

2014

Prohibits insurers from denying coverage to people with medical problems or refusing to renew their policy. Health plans cannot limit coverage based on pre-existing conditions or charge higher rates to those in poor health. Premiums can vary only by age , place of residence, family size and tobacco use.

Coverage expansion goes into high gear as states create new health insurance exchanges – supermarkets for individuals and small businesses to buy coverage.

People who already have employer coverage won’t see any changes.

Medicaid is expanded to cover low-income people at up to 133 percent of the federal poverty line, about $29,300 for a family of four. Low-income childless adults are covered for the first time.

Requires citizens and legal residents to have health insurance, except in cases of financial hardship, or pay a fine to the Internal Revenue Service. The penalty starts at $95 per person in 2014, rising to $695 in 2016. The family penalty is capped at $2,250. Penalties are indexed for inflation after 2016.

Penalizes employers with more than 50 workers if any workers get coverage through the exchange and receive a tax credit. The penalty is $2,000 times the total number of workers employed at the company. However, employers get to deduct the first 30 workers.

hamptonroads.com/2010/04/health-care-law-if-you-are-us-citizen-or-legal-resident

hamptonroads.com/2010/04/new-health-care-law-what-does-it-mean-you

hamptonroads.com/2010/04/breakdown-how-and-when-youll-be-affected