Health reform is law. Health reform is law. I have to keep saying it to myself. And now that health reform is law, everyone seems to be asking the next logical question: What does this mean for me? I’ve tried to help by pointing you in the direction of a couple of handy gadgets out there on the web, but today I wanted to just focus in on a couple of areas where the misconceptions continue to abound: The Exchanges and the individual mandate. (As an aside, I like to capitalize “The Exchanges” because it makes it sound like a fancy new condominium complex in Crystal City.)
To put it simply, The Exchanges are a series of state-level marketplaces that will help people shop for affordable, high quality health insurance. It’s also a means of making it easier for the government to regulate the insurance companies. Of course, The Exchanges aren’t going to be open to everyone initially. For most people, insurance will continue to work much like it has in the past. For an excellent overview on all of this, I point you to Ezra Klein. One of the distinct unintended consequences of this state-by-state approach is that The Exchange in one state may function better than The Exchange in another state. Consequently, new disparities in health care may arise along this new dimension.
The other new thing–and one that does affect everyone–is the individual mandate. You will be required to have insurance coverage or else pay a penalty. Again, Ezra has all the details. It’s worth remembering, though, that what the government has done is established a benefit floor here. Most folks already have coverage well above that minimum and aren’t going to suffer any noticeable effects from the mandate. People who are uninsured are the ones who face this new condition. That would be a bad thing if the government didn’t make provisions to help them purchase this required coverage, but they did. The subsidies are actually fairly generous and operate on a sliding scale–the more help you need the more help you get. As Maggie Mahar has reported, even a family of four earning up to $88,200 (or 400% of the federal poverty level) will be eligible for some federal assistance. So, to recap, you’re probably not going to notice a change, but if you do, you’ll either be wealthy enough to take it in stride, or you’ll receive help from Uncle Sam.
Still, there are concerns that the individual mandate is unconstitutional, that insurers will artificially jack up premiums prior to the date that reforms take effect, and even continued complaints that Congress has exempted itself from the reforms it passed. None of these things is true. Specifically, the individual mandate already exists in Massachusetts and no federal courts have overturned it, insurers won’t raise premiums artificially, because they will simply have to refund the money if it isn’t spent on care, and Congress wrote the law requiring that they participate in The Exchanges.
I’m glad people are interested to learn more about what reform means for them. I just hope that they will stop buying into the misguided hype, because it’s simply not true.