2011 Health Care Changes
Health care reform gets into gear in 2011 with new benefits, regulations, and services designed to provide better and more affordable health care for Americans. Many people will benefit from these changes. However, many of these reforms also carry unintended consequences that negate the positive result. Are they worth the cost? You be the judge:
1. Chain restaurants and vending machines for food must post the nutritional content of each item by March 31.
2. An additional $11 billion over 5 years will fund community health centers.
3. Small businesses can apply for grants to support employee “wellness” programs
Several of these 2011 changes can potentially lead us to healthier lives. For one, given more information about what they are ordering, people might make healthier choices when dining, or snacking out, albeit at higher prices. In addition, community health centers play an important part in providing basic medical services in depressed and rural areas; and expanding them would also be a big plus. Issuing small businesses grants to establish wellness programs is another excellent idea. These are some of the good ideas that can be found in health care reform.
4. Drug companies must discount brand name drugs sold to individuals in the Medicare Part D coverage gap 50%, further closing the ‘doughnut hole’. A government subsidy of 7% reduces the cost of generic drugs to these individuals as well.
Until 2003, when Medicare Part D passed, seniors paid the full amount for all their drug needs. The new plan offered discounted drugs each year until an individual’s expenses reached $2830. More comprehensive coverage resumed when expenses reached $4550 for the remainder of that year. Referred to as the ‘doughnut hole’, this yearly gap in drug insurance coverage was added to the bill to lower the cost of the benefit on the nation’s budget, keeping the estimated 10 year price tag for Medicare Part D at that time under $394 billion. Today, we face a record $1.56 trillion budget deficit. Why are we adding this expense now when it was unwise to do it 8 years ago, under less dire circumstances?
5. In addition to providing a mandated 50% discount on drugs in the ‘doughnut hole’, pharmaceutical manufacturers will begin paying an additional annual tax on drug sales starting at $2.5 billion and rising to $4.1 billion by 2018.
Drug companies must continually develop new drugs to maintain their viability in the world marketplace. However, each new life saving drug costs $800 million to $2 billion to develop. Reducing drug company capital by raising taxes and lowering revenues slows the development of new drugs, a key element in improving our health. How ironic is it that measures in the name of health reform would lower our health quality of life?!
6. Medicare beneficiaries are no longer required to make co-payments for some 20 preventative care services including mammograms, colonoscopies, and smoking cessation programs. Also, the costs for these services will not be included in calculating the annual Medicare deductible.
Eliminating Medicare recipients’ costs for preventive care would be a worthwhile endeavor if Medicare wasn’t facing a financial crisis of its own with more baby-boomers joining the system and much fewer people paying into it. Also, how does increasing Medicare benefits square with the health care reform bill’s $500 billion reduction of Medicare’s budget?? It doesn’t make sense.
7. Insurance companies must limit administrative costs to 15% (large group plans) and 20% (small group plans), maintaining a medical loss ratio (MLR) of 85% – 80%.
Experts in public health policy have rejected the use of MLR as a measure of insurance company efficiency and health care quality. The costs of maintaining a business vary widely based on, among other things, the area served, the local cost of doing business, and the amount of customer support and interaction. Probable consequences of this regulation include the closing of smaller insurance companies, the loss of customer support services, job losses, and higher premiums.
8. Note: The plan for Medicare to reimburse doctors for end-of-life discussions with their patients, slated to begin January 1, was deferred.
It’s interesting that doctor reimbursements for end-of-life discussions were in the original health care reform bill, but Congress rejected its inclusion and the bill passed without it. Incredibly, it was decided to make it public policy anyway, without any Congressional approval, and a public outcry ensued, forcing its removal. Actually, there’s something to be said about end-of-life discussions as there is of much of health care reform. We need to have the opportunity to learn more about what’s being proposed for us and why and have the ability to weigh in on it. It would be nice if, in 2011, we had more opportunities to do this especially in regards to health care. After all, our lives depend on it…..