H.R. 3590 and H.R. 4872: A Timeline for Enactment of Health Care Reform Provisions

The health care reform legislation has many different provisions involved, with enactment dates are staggered over the next five years. To help you get some idea of when certain reform conditions are set to go into effect, ASJ found this timeline, provided by the Kaiser Family Foundation.

2010

Insurance reforms

• Establish a temporary national high-risk pool to provide health coverage to individuals with pre-existing medical conditions.
• Provide dependent coverage for adult children up to age 26.
• Prohibit individual and group health plans from placing lifetime limits on the dollar value of coverage and, prior to 2014, plans may only impose annual limits on coverage.
• Prohibit insurers from rescinding coverage except in cases of fraud and prohibit pre-existing condition exclusions for children.
• Provide tax credits to small employers with no more than 25 employees and average annual wages of less than $50,000 that purchase health insurance for employees.
• Create a temporary reinsurance program for employers providing health insurance coverage to retirees over age 55 who are not eligible for Medicare (effective 90 days following enactment until Jan. 1, 2014).
• Require health plans to report the proportion of premium dollars spent on clinical services, quality, and other costs and provide rebates to consumers for the amount of the premium spent on clinical services and quality that is less than 85 percent for plans in the large group market and 80 percent for plans in the individual and small group markets (requirement to report medical loss ratio effective plan year 2010; requirement to provide rebates effective Jan. 1, 2011).
• Establish a process for reviewing increases in health plan premiums and require plans to justify increases. Require states to report on trends in premium increases and recommend whether certain plans should be excluded from the exchange based on unjustified premium increases.

Medicare

• Provide a $250 rebate to Medicare beneficiaries who reach the Part D coverage gap in 2010 and gradually eliminate the Medicare Part D coverage gap by 2020.
• Expand Medicare coverage to individuals who have lived in specific state-of-emergency areas and have developed certain health conditions as a result of the conditions in those areas.
• Improve care coordination for dual-eligibles by creating a new office within Centers for Medicare and Medicaid Services – the Federal Coordinated Health Care Office.
• Reduce annual market basket updates for inpatient hospital, home health, skilled nursing facility, hospice, and other Medicare providers, and adjust for productivity.
• Ban new physician-owned hospitals in Medicare, requiring hospitals to have a provider agreement in effect by Dec. 31; limit the growth of certain grandfathered physician-owned hospitals.

Medicaid

• Create a state option to cover childless adults though a Medicaid State Plan Amendment.
• Create a state option to provide Medicaid coverage for family planning services to certain low-income individuals through a Medicaid state plan amendment up to the highest level of eligibility for pregnant women.
• Create a new option for states to provide Children’s Health Insurance Program coverage to children of state employees eligible for health benefits if certain conditions are met.
• Increase the Medicaid drug rebate percentage for brand name drugs to 23.1 percent (except the rebate for clotting factors and drugs approved exclusively for pediatric use increases to 17.1 percent); increase the Medicaid rebate for non-innovator, multiple source drugs to 13 percent of average manufacturer price; and extend the drug rebate to Medicaid managed care plans.
• Provide funding for and expand the role of the Medicaid and CHIP Payment and Access Commission to include assessments of adult services (including those dually eligible for Medicare and Medicaid).

Tax changes

• Limit the deductibility of executive and employee compensation to $500,000 per applicable individual for health insurance providers.

2011

Long term care

• Establish a national, voluntary insurance program for purchasing community living assistance services and supports (CLASS program).

Prevention/wellness

• Improve prevention by covering only proven preventive services and eliminating cost-sharing for preventive services in Medicare; increase Medicare payments for certain preventive services to 100 percent of actual charges or fee schedule rates. For states that provide Medicaid coverage for and remove cost-sharing for preventive services recommended by the U.S. Preventive Services Task Force and recommended immunizations, provide a one percentage point increase in the FMAP for these services.
• Provide Medicare beneficiaries access to a comprehensive health risk assessment and creation of a personalized prevention plan and provide incentives to Medicare and Medicaid beneficiaries to complete behavior modification programs.
• Provide grants for up to five years to small employers that establish wellness programs (see “Evolving Your Health Practice: How to Offer Wellness Plans to Group Clients” for advice on selling wellness in the workplace).
• Establish the National Prevention, Health Promotion and Public Health Council to develop a national strategy to improve the nation’s health.
• Require chain restaurants and food sold from vending machines to disclose the nutritional content of each item.

Medicare

• Require pharmaceutical manufacturers to provide a 50 percent discount on brand-name prescriptions filled in the Medicare Part D coverage gap beginning in 2011 and begin phasing in federal subsidies for generic prescriptions filled in the Medicare Part D coverage gap.
• Provide a 10 percent Medicare bonus payment to primary care physicians and to general surgeons practicing in health professional shortage areas (effective 2011 through 2015).
• Restructure payments to Medicare Advantage (MA) plans by setting payments to different percentages of Medicare fee-for-service (FFS) rates.
• Prohibit Medicare Advantage plans from imposing higher cost-sharing requirements for some Medicare covered benefits than is required under the traditional fee-for-service program.
• Reduce annual market basket updates for Medicare providers beginning in 2011.
• Freeze the income threshold for income-related Medicare Part B premiums for 2011 through 2019 at 2010 levels, and reduce the Medicare Part D premium subsidy for those with incomes above $85,000 per individual and $170,000 per couple.

Medicaid

• Prohibit federal payments to states for Medicaid services related to health care acquired conditions.
• Create a new Medicaid state plan option to permit Medicaid enrollees with at least two chronic conditions, one condition and risk of developing another, or at least one serious and persistent mental health condition to designate a provider as a health home. Provide states taking up the option with 90 percent FMAP for two years for health home related services including care management, care coordination and health promotion.
• Create the State Balancing Incentive Program in Medicaid to provide enhanced federal matching payments to increase non-institutionally based long-term care services.
• Establish the Community First Choice Option in Medicaid to provide community-based attendant support services to certain people with disabilities.

Tax changes

• Exclude the costs for over-the-counter drugs not prescribed by a doctor from being reimbursed through a health reimbursement arrangement or health flexible spending account and from being reimbursed on a tax-free basis through a health savings account or Archer Medical Savings Account.
• Increase the tax on distributions from an HSA or an Archer MSA that are not used for qualified medical expenses to 20 percent of the disbursed amount.

2012

Medicare

• Make Part D cost-sharing for full-benefit dual eligible beneficiaries receiving home and community-based care services equal to the cost-sharing for those who receive institutional care.
• Create the Medicare Independence at Home demonstration program.
• Provide bonus payments to high-quality Medicare Advantage plans.
• Reduce rebates for Medicare Advantage plans.