Healthcare law: What’s at stake for you
By Mark Miller
Ordinary Americans have a lot at stake this week as the Supreme Court holds hearings on the constitutionality of the Affordable Care Act (ACA).
It is not clear what the outcome will be, and it is not clear where Americans stand on it. While two-thirds of Americans oppose the individual insurancemandate that is at the heart of the Obama Administration’s healthcare reform law, according to a Kaiser Family Foundation survey, the polls also reveal more nuanced attitudes.
Americans are evenly divided on the overall law, with 47 percent supporting it, according to Pew Research. And a New York Times/CBS News poll finds that many of the law’s key provisions are backed by large majorities: the law’s popular features include the requirement that insurance companies cover people with pre-existing conditions (85 percent), letting children stay on parents’ policies until age 26 (68 percent) and cutting the cost of prescription drugs for seniors (77 percent).
Here’s a breakdown of what is at stake if the Supreme Court strikes down the law:
BENEFITS ALREADY IN PLACE: Although key benefits of the ACA won’t be implemented until 2014, significant changes are already in place. For example, 2.5 million young adults age 19 to 25 are now covered on their parents’ policies. For Medicare, the first steps to close the gap in prescription drug coverage — the notorious “donut hole” — saved $2.1 billion for nearly 3.6 million seniors last year, according to the U.S. Department of Health and Human Services.
STATE EXCHANGES: State insurance exchanges, which are being set up now and will fully launch in 2014, will open up access to insurance for anyone who can’t access group healthcare coverage through the workplace — a crucial, growing problem in an economy characterized by volatility and stubbornly high levels of structural unemployment.
For example, nine million Americans age 50 to 64 were uninsured as of 2010 — up from 5.3 million in 2002, according to The Commonwealth Fund. Too young for Medicare, their only option now is the individual insurance market, where premium prices are high, coverage is partial and many can’t buy policies at all due to pre-existing conditions. Nine million individuals were turned down for coverage in the individual market over the past three years due to pre-existing conditions, Commonwealth says.
Starting in 2014, the law will ban charging higher premiums or denying coverage based on health or age, and insurance companies will no longer be permitted to disqualify applicants based on pre-existing conditions. And applicants will be eligible for federal subsidies on the cost of coverage if they make less than 400 percent of the federally defined poverty level — currently $92,000 for a family of four. For this group, the subsidy uses a sliding scale to hold costs as a share of income between 2 percent and 9.5 percent.
The Congressional Budget Office (CBO) projects that 23 million Americans will gain coverage through the state exchanges by 2019. “That’s a very sweeping change for people who need to retire early, are unemployed, or have a job that doesn’t offer health care benefits,” says Sara Collins, vice president for affordable insurance at The Commonwealth Fund.
The process will start with an application for insurance submitted to your state exchange; depending on your income, you’ll be eligible to buy a policy in the exchange — or receive coverage under Medicaid.
MEDICAID EXPANSION: Medicaid primarily serves parents with very low incomes, and few states cover adults who do not have children. The ACA provides federal funding for a dramatic expansion of Medicaid. The new program will serve all households that are living around the federal poverty level — about $30,000 in annual income for a family of four. Fifty-seven percent of adults in that income range were uninsured for at least part of 2011, and 41 percent were uninsured for one year or longer.
So that’s what’s at stake if the healthcare reform law is struck down by the Supreme Court. All told, 31 million Americans who otherwise would have health insurance won’t be covered at the end of this decade, and we’ll be back to the drawing board on healthcare reform. Here’s hoping it doesn’t happen.