FCNL Analysis of House Health Insurance Reform Bill (H.R. 3962)

FCNL has lobbied for health insurance reforms that would assure access to health care that is:

The Affordable Health Care for America Act,
(H.R. 3962) offers:

Affordable

• Medicaid for everyone with incomes less than 150% of the poverty line
• Tax credits for individuals and families who don't have health insurance, with incomes up to 4 times the poverty line (about $88,000 for a family of four).
• The credits limit the amount an individual or family would have to spend on premiums: no more than 1.5% of income for the lowest income people, up to 12% of income for those at the top of the subsidy scale.
• Limits on out-of-pocket expenses for individuals and families purchasing insurance through a health exchange, graduated according to income.
• A requirement that insurance companies spend 85% of their income from health care premiums on health care.
• Competition from a public insurance option which uninsured individuals and employers may choose, if the private market does not offer a reasonably priced insurance product.
• By 2015, the public insurance option would be open to small businesses with up to 100 employees - about 36% of all employees.
• After 2015, the public option and other health exchange plans may be made available to employers of all sizes.
• Health insurance exchanges that align qualifying health care plans as to benefits and costs, so that consumers can make reasonable choices among them.

Comprehensive

• To participate in the health insurance exchange or, eventually, to offer insurance as a tax-exempt employee benefit, plans will be required to offer an essential benefit package (called a Qualified Health Benefit Plan or QHBP), including at a minimum: primary care, prescriptions, mental health and addiction recovery services, durable medical equipment, preventive services, maternity care, hospitalization, surgeries, and related costs.
• QHBPs will be required to offer oral health, vision and hearing services and equipment for children up to age 21.
• QHBPs also must conform to some consumer protections, including limits on out-of-pocket expenses, no-cost preventive services, appeals processes and maintaining an adequate network of providers.
• Only QHBPs may be offered to individuals through the health exchange.
• After an initial grace period, all health care plans will have to meet the requirements of a QHBP in order to be offered as a tax-free employment benefit.

High quality

• A Health Benefits Advisory Commission will oversee the essential benefits offered in the QHBPs and will recommend changes as needed over time, based on evidence of effectiveness.
• The Commission will include physicians, other health care providers, and patients.
• All plans, from "basic" to "premium" will have to offer the same benefits; they will vary as to the size of the consumer's co-payments, not as to the quality or availability of services. Insurers may offer "premium plus" plans, separately priced, that include additional services.

For everyone

• The Congressional Budget Office estimates that this bill will ensure that 96 percent of all U.S. citizens and legal residents have health insurance when it is fully implemented.
• No exclusions for “pre-existing conditions” and no pricing based on health status are permitted.
• No lifetime or annual limits on medical spending allowed; different rates based on age are limited to a ratio of 2:1.
• Children may stay on their parents’ plans until age 27, at their parents’ discretion.
• The bill establishes and expands community health centers.
• The bill includes specific programs to address and remedy health and health care disparities among different racial, ethnic, and economic groups.
• The bill incorporates the Indian Health Care Improvement Act, which has not been reauthorized since 1992.

Financed by progressive taxes

• Much of the reform in the bill is accomplished by regulation rather than by spending.
• The large expenditures include Medicaid expansion, Medicare improvements, affordability credits, and expanded public health programs.
• The bill includes a surtax on the incomes of the wealthiest households and individuals, those with annual incomes above $1 million income per year (or $500,000 for single individuals).