The Bridge to 2014

Most of us probably missed it during the great Health Reform debate.  However, there was a billed passed in March 2010 called the "Patient Protection and Affordable Care Act" by our congress and signed by President Obama.  It is a law and now we need to read the 300+ page document to understand what it means.

Since I am currently looking for insurance coverage to compete with a group plan offered by my wife's employer this bill may hold some answers.  However, after reading the first 100 pages the concept is that this bill is primarily enacted as a prelude to the larger Healthcare Reform bill set to go in effect in 2014.  Also called the Bridge to 2014.  One recurring theme was that this bill is primarily responsible to "control" the cost of healthcare.  However, it basically involves definitions that healthcare systems are supposed to measure health outcomes, reduce readmissions, promote wellness, and require a health plan to report the ratio of incurred loss plus the loss adjustment expense to earned premiums.  Yes, I was at a loss as well to the last statement.

One line that stood out is that "health plans are suppose to provide ANNUAL rebates to each enrollee if the ratio of the amount of premium revenue expended by the issuer on reimbursement for clinical services provided to enrollees and activities that improve health care quality to the total amount of premium revenue for the plan year is less than a 85% for large group markets or 8-% for small group or individual markets."  This line is straight out of the new law.

If we break this statement down, it states that "health plans" (insurance companies) are suppose to measure the amount of premiums paid versus the amount paid for care per enrollee.  The problem is that "enrollee" is not defined.  Will rebates go back to the group plan holder or the individual plan holder?  Similarly, who is going to provide oversight to this law?  If oversight is required and insurance companies are now required to add an additional layer of staff to provide this documentation how is this going to be paid for?  The only way I can see this being paid for is higher premiums and plan costs to cover the added expense.  Also, since the Government will need an entire new organization to provide oversight there will be an added expense for the federal government to monitor this act (increase taxes).

Not really a win-win and definitely a bridge to no-where.

Since it is open enrollment time, I suggest that each of you plan on reviewing this bill to see if there is anything in there that you can benefit from.  If not, prepare for premiums to go up...again!