Principal Components of House Health Reform Legislation Unveiled
The Facts
House Democrats released the broad parameters of their comprehensive health reform bill June 8, 2009. The three House committees with jurisdiction over health reform plan to work from this common framework to develop a systemic reform proposal. Click here for a health reform timeline. Below are highlights of the plan:
- Protects current coverage and preserves choice of doctors, hospitals and plans
- Creates a new national health insurance plan
- Creates a national health insurance exchange and allows for regional or state exchanges
- Initiates delivery system reforms, such as accountable care organizations, to incentivize quality and restrain health spending growth
- Imposes individual coverage requirement and employer “pay or play”
- Prohibits insurers from excluding pre-existing conditions and forbids rating based on gender, health status or occupation, and limits premium variation based on age
- Reforms Medicare’s sustainable growth rate formula for physician payment
- Eliminates perceived overpayments to Medicare Advantage Plans
What’s at Stake
Reporting out a House bill by the August recess is at stake. While the House Democrats have united the three key House committees in producing this common framework, considerable dissension within the Democratic party remains. A core area of disagreement is whether to include a public plan. Pressure to achieve reform this year is considerable, as the Democrats do not want to risk spilling into next year’s congressional cycle.
Steps to Consider
Providers should assess the impact of a public plan option and expanded coverage, among other proposals. Insurers should examine the impact of a Medicare-like public plan option on provider payments and the ultimate competitiveness of private plans, review the concept of the insurance exchange and assess the business impact of the proposed new insurance market reforms. Insurers that act as Medicare Advantage Plans should monitor proposals to reduce payments. Both providers and insurers should assess the potential impact of accountable care organizations. Finally, employers should carefully monitor “pay or play” proposals and prepare to adapt to potential requirements.
