Reform Terminology Defined
+ What are Affordability Credits?
- These credits refer to discounts that will be provided by the government to families and individuals that will make health insurance affordable
- Credits will be set on a sliding scale so that families who earn less will be required to pay a smaller percentage of their income to buy insurance (For more information, click here)
+ What is the Federal Poverty Level (FPL)?
- Federal Poverty Level (FPL) is an informal way of referring to the federal poverty guidelines, which are one version of the federal poverty measure (with the other being the "poverty thresholds")
- The guidelines are issued each year by the Department of Health and Human Services (HHS), and used for administrative purposes - for instance, determining eligibility for certain federal programs
- The numbers published refer to pre-tax income (see table below; For more information, click here)
| Persons in Family Unit | 48 Contiguous States and D.C. | Alaska | Hawaii |
|---|---|---|---|
| 1 | $10,830 | $13,530 | $12,460 |
| 2 | $14,570 | $18,210 | $16,760 |
| 3 | $18,310 | $22,890 | $21,060 |
| 4 | $22,050 | $27,570 | $25,360 |
| 5 | $25,790 | $32,250 | $29,660 |
| 6 | $29,530 | $36,930 | $38,260 |
| 7 | $33,270 | $41,610 | $42,560 |
| 8 | $37,010 | $46,290 | $40,940 |
| For each additional person, add | $3,740 | $4,680 | $4,300 |
- Fee-for-service occurs when doctors and other health care providers receive a fee for each service such as an office visit, test, or procedure
- Fee-for-service health insurance plans typically allow patients to obtain care from doctors or hospitals of their choosing, but in return for this flexibility they may pay higher copayments or deductibles
- Patients frequently pay providers directly for services, then submit claims to their insurance company for reimbursement
+ What is Grandfathered coverage?
- Refers to health insurance coverage purchased or provided by employers before new health care laws are put into effect
- Individuals will be allowed to keep this coverage if they like, even if it does not meet the new standards set forth by the new laws
- After grandfathered coverage expires, individuals will be able to choose from private and public insurance options that will conform to the new health care reform laws
+ What is a Health Insurance Exchange?
- Refers to a new "virtual marketplace" where individuals and small businesses can compare and purchase private and public insurance plans
- The government will regulate the exchange so that insurance companies can not discriminate against people with pre-existing conditions, or charge widely varying amounts for similar coverage (However, companies will be able to set rates based on an individual's age)
- It has yet to be determined whether a separate Exchange will be setup within each state, or if a single Exchange will be offered nation-wide
- The American Health Benefit Gateway, proposed by the Senate HELP Committee, refers to state-based insurance exchanges for small employers
+ What is the House Tri-Committee?
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The Committee on Ways and Means
- jurisdiction over all taxation, tariffs and other revenue-raising measures
- Also oversees other programs including: Social Security, Unemployment benefits, Medicare, Enforcement of child support laws, Temporary Assistance for Needy Families, and Foster care and adoption programs
- For more information, visit: http://waysandmeans.house.gov/
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The Committee on Energy and Commerce
- Has developed what is arguably the broadest (non-tax-oriented) jurisdiction of any Congressional committee
- Maintains principal responsibility for legislative oversight relating to telecommunications, consumer protection, food and drug safety, public health, air quality and environmental health, the supply and delivery of energy, and interstate and foreign commerce in general
- For more information, visit: http://energycommerce.house.gov/
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The Committee on Education and Labor
- The Committee and its five subcommittees oversee education and workforce programs including: early learning, secondary education, higher education, job training, labor, pensions, workforce protection, lifelong education, and retirement
- For more information, visit: http://edlabor.house.gov/
+ What is a Medical Loss Ratio (MLR)?
- Refers to the fraction of an insurance company's income (from patient's premiums) that goes to pay for medical services
- Thus, the lower the number, generally the higher the insurance company's profits
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For example:
- an MLR of 0.95 means that 95% of premiums were spent on purchasing medical services for the individuals insured by the company
- an MLR of 0.80 means 80% of premiums were spent on health care, leaving 20% for the insurance company
+ What is a Pre-existing Condition?
- A pre-existing condition is a medical condition that an individual has before he or she obtains health insurance
- A question that often arises within the context of a pre-existing condition is: How is the condition like this going to affect my health care coverage?
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There is no simple answer; a pre-existing condition may result in:
- The denial of any health care insurance coverage for the individual by the insurance company
- A refusal to provide coverage for that specific pre-existing medical condition for 9 - 12 months
- No effect on an individual's coverage
- Health care reforms currently being proposed will prohibit insurance companies from discriminating against individuals with pre-existing conditions
+ What is a Public Health Insurance Option?
- One of the insurance choices under consideration on the proposed Health Insurance Exchange will be a public option, which will be an insurance plan offered by the government
- A public option would drive costs down by forcing insurance companies to compete with an affordable high-quality option
- President Obama has said the public option will increase patient choice and keep private insurers honest by competing with them so they are unable to charge unfair rates
- Many experts believe that the public option will be the least expensive option on the exchange
+ What is a Single-Payer Health Care System?
- Refers to a health care system in which only one organization collects all health care fees, and pays out all health care costs
- In the current US system, there are several thousand different health care organizations that act as "payers" (referred to as a multi-payer system)
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Single-payer systems reduce administrative costs and simplify health care billing, since all hospitals and other health care providers bill one entity for their services, eliminating the need to hire numerous individuals to:
- fill out different forms for each insurance company
- learn different billing systems, and
- figure out which insurance companies pay for which services or medications
- Current health care reform proposals in the USA do not support a single-payer system
+ What is the State Children's Health Insurance Program (SCHIP)?
- SCHIP is a program designed to provide health insurance for uninsured children in families with incomes that are modest but too high to qualify for Medicaid
- It is administered by the United States Department of Health and Human Services, but involves a partnership with state governments - the funds are provided federally, but programs are administered by the state
- It was sponsored by Senator Ted Kennedy in a partnership with Senator Orrin Hatch during the Clinton administration
- TRICARE is the health care program serving active duty service members, National Guard and Reserve members
- It also covers retirees, their families, survivors and certain former spouses worldwide
+ What is Universal Health Care?
- Refers to health care coverage for all citizens of a nation, regardless of income level or employment status, and often covers medical, dental and mental health care
- In such a system, health care services are primarily paid for by government-funded programs, but is often in combination with private insurance companies for services not provided for by the government (e.g. certain dental care, prescription eye-wear, etc)
- Universal health care is implemented in nearly all developed nations, with the exception of the USA, as well as in many developing countries