The new national health care bill just signed into law by President Barack Obama marks a major overhaul of the nation’s health care system. GW Professor of Health Policy Leighton Ku, one of The George Washington University’s experts on health care policy, talked with GW Today about the landmark legislation and what changes will come over the next decade.
Dr. Ku has testified before Congress and state legislatures on health care and has submitted expert affidavits in federal and state lawsuits involving Medicaid cost-sharing and immigrant rights.
Dr. Ku, along with faculty and staff of The Hirsh Health Law and Policy Program in GW’s School of Public Health and Health Services, recently released the National Health Reform Law and Policy Project, which provides a user’s guide, comparative analyses and summaries of the major pieces of the health form legislation.
Q: How significant is this legislation?
A: It is very significant. This legislation is probably the most important health care legislation in generations and the most important since the creation of Medicare and Medicaid in the 1960s.
Q: What are the key provisions of the new health care law?
A: It will expand health insurance coverage over the next decade to another 32 million Americans and thus greatly reduce the number of uninsured. It will also help improve coverage for those who already are insured by eliminating the pre-existing condition exclusion that insurers have been able to use to deny coverage to people with illnesses or other medical conditions.
The law will also help to make health care insurance coverage more affordable for people, provide subsidies for millions of low-to-moderate income Americans to purchase private health care insurance and expand Medicaid to millions more who are not covered, including low income parents and adults who don’t have children.
Q: Who will be the largest beneficiaries of the law?
A: There are different types of beneficiaries. Many people will get health care who are currently excluded, including people living below the poverty line, which is an annual income of around $22,000 for a family of four. Additional federal subsidies will help people in that income range. Specifically, tax credits will help these people purchase health insurance from health insurance exchanges. It will take time to set those up, so that’s why these provisions don’t take effect until 2014.
Q: When will these provisions take effect?
A: Changes in regulatory policies like the expansion of dependent coverage under private insurance and elimination of the pre-existing condition exclusion will happen fairly soon. Other provisions such as the creation of health insurance exchanges or reforms to Medicaid will happen in 2014. Although the president just signed the legislation, there is a “fix-it” bill—which slightly tweaks the original legislation— that just passed in the House of Representatives and is now in the Senate. So we’re still going to see health care on TV and in the press for the next week or so.
Q: How will this law impact GW employees and GW students?
A: For many GW students, it will help improve health insurance coverage. Dependent coverage typically ends in late teens but the new bill will expand it to people into their mid 20s, so that will be of immediate help to young people.
GW employees’ health care plans will stay somewhat the same. Health care costs are going up for GW employees and everyone, so that will happen one way or another. My understanding is that GW’s health insurance policies are relatively affordable, but those employees who cannot afford it right now will receive assistance when health care subsidies go in effect in 2014.
Q: What financial sources will cover the expansion of insurance?
A: The insurance expansions are being paid for by a combination of savings from existing spending and some new health care-related taxes. Currently, there’s a Medicare program that offers extra coverage called Medicare Advantage, which costs the government about 13 percent more than traditional Medicare. But in the new health care bill, parts of this Medicare Advantage program will be cut to save approximately $132 billion over 10 years. Some people have also talked about creating revenue with a new tax on “Cadillac” health insurance plans—plans that are very expensive. There will also be a higher Medicare payroll tax imposed on people who make more than $250,000 a year.
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