Outline of Individual and Employer Coverage under House Health Care Reform Bill V. 1

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1 Gerald Prante, Outline of Individual and Employer Coverage under House Health Care Reform Bill 1 (2009)

handle is hein.taxfoundation/ffbifxz0001 and id is 1 raw text is: FUDTOFISCAL
August2009
No. 185 FC
.FACT
Outline of Individual and Employer Coverage
under House Health Care Reform Bill
By Gerald Prante
This Tax Foundation Fiscal Fact provides a brief outline of the House health care reform bill entitled
America's Affordable Health Choices Act. The information provided is based upon our interpretation
of the Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) descriptions of the
bill. Some of the text is taken directly from the CBO report. There are obviously costs and benefits to
each of the provisions in the bill (the key ones are listed below), but this report does not assess those
and is merely designed to provide the public with information on how the bill would treat different
scenarios of health insurance coverage.
The House bill would, among other things, establish a public option for health insurance that would be
available in a national health insurance exchange (private insurers would be allowed in as well). It
would also impose new taxes on most businesses that did not provide health insurance to employees
(i.e. pay or play) and new taxes on individuals who did not purchase health insurance on their own
(assuming it was not provided by an employer).
Some important technical notes regarding some of the scenarios are provided at the end of this report,
but the following are highlights of key provisions in the bill that would be in place once the bill was
fully phased-in (we ignore transition years in this report):
* If an employer chooses to offer coverage, no employee can be excluded.
Insurers would be required to issue policies to all applicants and could not limit coverage based
upon preexisting conditions.
* Premiums would only be allowed to vary across individuals based upon age (by a factor of
two).
The national health insurance exchange would include a public option run by the Department of
Health and Human Services that would pay Medicare rates plus 5% for physicians and
Medicare rates for hospitals.
Medicare providers would not be required to participate in the public option.