Health Insurance Reform Update

Well the day has finally arrived! Starting today, September 23, the health insurance reform mandates become applicable to all health insurance plans except those that are grandfathered.

The law requires that all plans include free preventive care with no co-pays, coinsurance, or deductibles applicable; no additional charges for emergencies outside the plan's network; a pediatrician or OB/GYN can be chosen as a Primary Care Physician; no lifetime limits or annual dollar limits on essential health benefits; parents can keep adult children on their health insurance until age 26; insurers must accept children under 19 with any pre-existing conditions; and insurers cannot rescind coverage when an insured gets ill and has expensive costs but can only rescind due to fraud and intentional misrepresentation.

From a humanitarian point of view these are all applaudable reforms and once the requirement to also accept adults with pre-existing conditions and the donut hole in Medicare prescription drug plans is closed in 2014 the social inequities of our healthcare system will have been corrected. However, the inevitable cost to insurers, the federal government, employers, and consumers has yet to be revealed and I suspect that cost will be high. Insurance premiums are continuing their upward spiral this year in the midst of healthcare reform and some insurers are opting out of certain markets that requires them to take possibly unprofitable business as evidenced by some insurance companies in Florida, Oklahoma, and now California suspending the sale of Children Only policies.

Many Americans are confused as to how healthcare reform will effect them. The benefit reforms are all positive and provide health insurance for those that were previously denied coverage. This would reduce the ranks of the uninsured if the premiums were affordable but the premiums for the gap coverage for adults with pre-existing conditions that most states have rolled out recently are exorbitant. And since Individual and Group plans have continued to renew with double digit rate increases it seems that unless and until the premium costs are reformed the goal of healthcare reform cannot be met. We'll see if the proposed exchanges to be implemented in 2014 will, indeed, drive down rates.