Health care reform: Are you a winner or a loser?

Every new piece of legislation has winners and losers. Health care reform legislation is no exception, and, given the historic nature of the law, there are some very big winners as well as some very big losers.

Some of the biggest winners who will get help this year include people with pre-existing conditions who, within 90 days, can finally get insurance through temporary pools. And many will be happy to hear that within six months, insurers will no longer be able to take away coverage (ironically) because you get sick, unless the insurance company can prove fraud.

Also on the winning end: All those who will no longer have a co-pay for some preventive services, who will have lifetime limits removed from their policies, and who are tired of waiting for coverage -- under the law, insurers will have to limit waiting periods to 90 days for coverage.

Here are other big winners and losers in the new era of health care:

WINNERS: College students. Within six months, college students will be able to stay on their parents' insurance until they are 26 years old.

LOSERS: People who don't want to carry insurance. These people will be big losers, because they'll need to pay a tax penalty starting January 1, 2014. That penalty will be $695 per year up to a maximum of $2,085 per family or 2.5% of household income. The penalty will be phased in gradually over three years, starting with $95 in 2014. The penalty could go as high as $750 if the reconciliation bill doesn't pass the Senate.

WINNERS: Children with pre-existing conditions, such as diabetes or asthma. They can get coverage within six months.

LOSERS: Taxpayers who make more than $200,000 individually or $250,000 as a married couple. These taxpayers will foot part of the cost of the reform. They will need to pay 0.9% more in Medicare taxes. The total Medicare payroll tax rate will be 2.35%. The current rate is 1.45%. The tax rate will apply to unearned income, such as dividends and capital gains, if the reconciliation bill is passed.

WINNERS: Middle class families that can't afford to buy insurance and fall below 400% of the Federal Poverty Level. They will get tax credits to help reduce their costs. For example, if you earn at 100% to 200% of the FPL, your out-of-pocket limits will be $1,983 for an individual and $3,967 for a family.

LOSERS: Taxpayers who get high premium insurance plans from their employers. They will need to pay a "Cadillac Tax." If your employer plan exceeds $8,500 for a single person or $23,000 for a family in premiums per year, you could be stuck with that tax.

WINNERS: Seniors who have Medicare Part D (drug coverage). They will see the doughnut hole diminish from the loss of 100% coverage for drugs when they enter the doughnut hole to a co-pay of 25% by 2020. Beginning in 2011, seniors will see the costs of brand-name drugs cut by 50% when they reach the doughnut hole. Also, there will be a $250 rebate to Medicare beneficiaries when they reach the doughnut hole coverage gap in 2010 to help with their prescription drugs expenses this year.

LOSERS: Young adults. They'll likely be losers in the amount they'll pay in monthly premiums. That's because there is a three to one limit on how much insurers can charge older people. Insurers can't charge seniors more than three times the amount younger people pay. That will likely increase premiums for younger people, but since the insurance pools will be much larger, the increase may not be that great.

Some health care players are winners and losers:

WINNERS/LOSERS: Drug companies. They agreed to contribute $84.8 billion over 10 years to help pay for the health care legislation and agreed to the 50% reduction in costs for drugs when seniors reach the doughnut hole. But they got some big wins in exchange. The government will not be able to negotiate the prices of drugs sold through Medicare Part D, and they got protection for 12 years against generic drugs competing with biotech drugs. Also, the law doesn't bar pharmaceutical companies from paying a fee to generic drug companies to delay the launch of these less expensive alternatives.

WINNERS/LOSERS: Insurance industry. When health care reform is full in place in 2014, the industry will likely have 32 million new customers from which they can collect premiums. They are expected to pay about $70 billion in new taxes over 10 years on health insurance premiums beginning in 2014. But they will have to make major changes in the way they do business, since they will no longer be able to deny coverage based on pre-existing conditions. They also can no longer limit coverage based on annual or lifetime caps (new policies will remove lifetime limits within six months; by 2014, lifetime limits, as well as annual caps, must be removed from existing policies). Right now, there is no regulation on how much premiums can go up each year, but Sen. Diane Feinstein (D-Calif.) told viewers on CNN yesterday that she would get a bill passed to regulate premium increases.

The law does establish a process for reviewing increases in health plan premiums and will require plans to justify increases. States will be required to report on trends in premium increases. The states can recommend that a plan be excluded from the the state-based exchanges, from which people will buy individual insurance, if insurers seek unjustified premium increases.

Insurers will also face a profit cap. Insurers will be required to spend 85% of premiums collected in the group marketplace and 80% of premiums collected from individuals and and small group markets on clinical services and quality or provide rebates to customers. They will need to report their medical loss ratio beginning in 2010 and be required to provide rebates if they make too much money starting on January 1, 2011.

WINNERS/LOSERS: Hospitals. They will likely benefit from the fact that 32 million more people have insurance, and the losses they incur to treat uninsured individuals will go down. They also will benefit from the ban on yearly and lifetime coverage caps. But in exchange, they will end up with a cut in annual increases to Medicare reimbursement rates. They will also see cuts in federal aid for treating indigent people beginning in 2014.

WINNERS/LOSERS: Doctors. They will see their patient loads increase dramatically with all the new insured patients -- how they handle this new load will help determine whether they are winners or losers. Doctors who effectively make use of physician's assistants and nurse practitioners will probably fare better under the new load. The law does increase reimbursement rates for doctors who take Medicaid patients, but did not eliminate the reduction in Medicare reimbursements permanently. That will still be a yearly decision for Congress to make. Doctors are also concerned with the creation of an independent payment advisory board that will oversee Medicare.

Those are the key winners and losers, but it's not an all inclusive list. You can find more details at Henry J. Kaiser Family Foundation.

Lita Epstein has written more than 25 books including The Complete Idiot's Guide to Social Security and Medicare and The Pocket Idiot's Guide to Medicare Part D.

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