Big Changes for Individual Health Insurance and Small Business Health Insurance
June 2010
While it's been subject to numerous analyses from political pundits and lobbyists, only a couple of organizations have used scientific measures to really understand how the recently passed health care bill will impact Americans and their
medical coverage.
One of them, completed by the RAND corporation, has found that their current
health care bill analysis predicts that it covers the most amount of people for the least amount of money, making it the best bet to resolve numerous medical coverage problems that have been plaguing the insurance market for some time.
So what does this mean? Mostly that some forms of medical coverage will see more tremendous change than others. For the most part the public can expect to see the greatest changes in 2014 to our individual health insurance market, and the small business health insurance market.
The
individual health insurance market will be the most radically affected; with the completion of state-run insurance exchanges - which will provide low cost coverage that covers a federally mandated minimum requirement of options - the individual market will offer consumers affordable coverage.
Also, insurance companies will no longer be able to deny consumers based on pre-existing conditions, making it easier to get coverage to those who most need it.
The down side? While most people find that individual health insurance is very expensive, a small group might find their prices going up. Young, healthy males typically pay very little for coverage since they use few services, but with the establishment of the minimum requirements of coverage, they may see that their plans will be forced to offer more services, and will thus cost more as well.
The other big change will come for
small business health insurance, which is also typically more expensive than other forms of medical coverage. Small business health insurance is as expensive as it is because small companies don't have the high numbers of employees that can be used as leverage when they purchase policies in the way that big corporations do.
Add to that the rising cost of health care, and most small business owners can't offer much coverage, if they can offer any at all.
While coverage will be mandated for employers by 2014, small business owners who have fewer than 50 employees will be exempt from any fines levied for not offering coverage. These same small businesses will be offered tax breaks of up to 50% per employee for offering coverage starting in 2010, hopefully making it more affordable to offer coverage.
Facts on:
Analysis of the Medical Coverage Bill Shows Surprising Results.
Did you know...
According to RAND, the health care bill will provide individual and small business health insurance at more affordable rates.
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And finally, in 2014 when the insurance exchanges are open, small business owners who still can't offer coverage will likely be able to offer their employees cash incentives to purchase their own coverage from the state-run exchanges. This option will cost small business owners less, but still entice workers who want to get medical coverage as part of their employment.
Other groups who will see some change include Seniors, whose drug costs will be addressed with reimbursement checks, and those whose insurance plans are considered "Cadillac" plans, who will face higher taxes.
Cadillac plans run over $7,000 per year, or $600 per month. Since most people don't have this type of coverage taxing these plans will theoretically offer the Federal Government some extra revenue without creating a tax burden for too many Americans.
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