Disability & Benefits: Health Care Reform Changes for 2010
Earlier this year Congress passed and the President signed into law a massive Health Care Reform, named the Patient Protection and Affordable Care Act. (PPACA) Its implementation will create major changes in how healthcare is delivered and how health insurance is purchased.
Transitional High Risk Insurance Pool – Effective July 1, 2010, persons who are not able to purchase health insurance due to a pre-existing condition will have the opportunity to purchase “affordable” coverage through high risk insurance pools operated by the states and funded by the federal government. Rates charged will be based on the average charge for health insurance by private insurers for similar coverage in the individual health market in that geographical area.
To be eligible for the coverage this year, a person:
* Must have a pre-existing condition that makes them otherwise uninsurable; and,
* Must have been uninsured for at least six months prior to applying.
* A person meeting these two criteria will be able to obtain coverage regardless of their health.
As of May 3, 2010, 30 states have indicated they will operate their own high risk pools. Persons living in states which do not operate such a pool will be able to purchase coverage through a federal fallback high-risk pool, currently being set up. These pools will operate until insurance companies are required to accept anyone regardless of their pre-existing condition or age in 2014.
Lifetime Maximums Prohibited – Effective at the start of plan years beginning after September 23, 2010, health plans will no longer be able to place lifetime or annual limits on new or existing health plans, both group and individual. For many employers who use December 31as the end of their plan year, this would take effect on January 1, 2011.
Rescissions Prohibited – Effective September 23, 2010, insurers will be prohibited from dropping persons from coverage when they become ill. Insurance companies have announced they will implement this provision immediately as well.
Children with Pre-Existing Conditions – Effective September 23, 2010, insurance companies will no longer deny coverage to children because of a pre-existing condition. (This will not apply to adults until 2014.) Children applying for coverage under a health plan that requires medical underwriting, whether singly or with a family, cannot be denied coverage due to past medical history.
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