The Impact of the New Law on Your Practice and Your Family

          The details and implementation timelines and pathways of the national health care reform program contained in the final legislative healthcare reform package are being carefully studied by ICA.  In addition to the exact legislative language contained in that massive 2,076-page bill, the implications for small business and families will depend on when and how the various sections of the new law are implemented.  The exact details will take some time to emerge as formal regulations and implementation rules and procedures now have to be drafted and passed through a formal rule making process overseen by the federal agency responsible for the administration or enforcement of a particular provision.  The final implementation of all provisions is not scheduled to be complete until 2014. 

What can be discerned from the statutory language at this point indicates a number of key benefits and costs likely to impact most chiropractic practices and all individuals and families in the nation.

• Health insurance must be available to all, renewable for all, and rate differences, such as for age, are limited. 
• Starting this year, insurers will be prohibited from placing lifetime dollar limits on policies and denying coverage to children because of pre-existing conditions.
• Parents will be able to keep children on their coverage up to age 26.
• Insurers may not arbitrarily cancel policies for risk and cost-containment or other self-serving reasons.  Under the US Senate bill, (Section 2712) health insurers are barred from retroactively canceling coverage after a patient gets sick, a practice known as "rescission," unless the patient committed fraud or made an intentional misrepresentation of a material fact as "prohibited by the terms of the plan or coverage."
• Insurers must publicly justify "excessive" rate increases, and federal grants would encourage states to require full "prior approval" of such increases.  Section 2794 of the Senate bill provides that:  (1) The Secretary of Health and Human Services, in conjunction with states, shall require health insurance companies to justify unreasonable premium increases prior to implementing them. Insurers are required to post the justifications on their websites.
• Almost everyone will be required to be insured or else pay a fine, which takes effect in 2014. The new law states: SEC. 5000A. REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE.  ‘(a) REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE.—An applicable individual shall for each month beginning after 2013 ensure that the individual, and any dependent of the individual who is an applicable individual, is covered under minimum essential coverage for such month.
• There are both exemptions and subsidies for low-income people.  Aid is available on a sliding scale for households making up to four times the federal poverty level, $88,200 for a family of four. Premiums for a family of four making $44,000 will be capped at around 6 percent of income.
• The bills aim to make health insurance more affordable for small businesses by creating more competition among plans through state-based insurance exchanges. No later than 2014, states will have to establish and have in full operation Small Business Health Options Programs, or "SHOP Exchanges," where it is intended to offer small businesses access to the kind of choices and discounts available to large-scale purchasers of health insurance. 
• Small businesses with fewer than 25 employees and average wages under $50,000 will be eligible for tax credits to pay up to 35 percent of their insurance costs.
• Companies with 25 or fewer employees may qualify for a tax credit starting this year, as provided in Section 1421 of HR 3590.    The amount of the credit will vary depending on the size of the company, and employers must pay at least 50 percent of the premium costs. The credit goes up to as much as 50 percent of premium costs in 2014.
• Self-employed people will be able to buy coverage through the exchanges, too, but will not qualify for the employer tax credits.

The new legislation also imposes new taxes. Individuals who make more than $200,000, ($250,000 for married couples) which includes many professionals and small business owners, will have to pay higher Medicare payroll taxes. The package of changes passed by the House also applies the tax to unearned income, such as dividends and interest.

The legislation also imposes a 40 percent tax on high-cost insurance plans worth more than $10,200 in premium payments annually for individuals and $27,500 for families. That new tax would go into effect in 2018. The bill imposes new taxes on pharmaceutical companies and medical device makers, costs which most analysis expect will be passed on to insurance customers.

The new law establishes penalties for companies with more than 50 employees if they do not offer health insurance or if they do not offer affordable insurance and an employee uses a federal subsidy to buy insurance individually. The penalty could be as much as $2,000 for every employee after the first 30.  Few chiropractic practices will be impacted by the large-employer requirements, however, but many companies serving the chiropractic profession and all chiropractic colleges will be impacted by these provisions.

The ICA Legislative Committee urges all doctors of chiropractic in the United States to keep in touch with their state and national chiropractic organizations for objective information on the implementation procedures issued by the various federal agencies for health care reform programs and initiatives. Caution is also urged in dealing with individuals or companies offering to “certify” or otherwise position individuals or companies as eligible for any health reform benefit and to deal directly with federal agencies, tax and accounting experts and through established, recognized chiropractic professional organizations to avoid being taken advantage of in this time of change and confusion.

ICA will continue to fight for chiropractic providers’ and patients’ rights in this process, without compromise.

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