Health-care reform expert answers your questions

Doctor watches presidetn sign health care reform billWhen President Obama signed the health care reform bill into law on March 23, medical coverage as we know it changed forever. But what does that really mean? WalletPop expert Josh King -- general counsel for Avvo.com, a free online legal directory -- takes a close look at the nearly 2,600-page legislation to help you navigate the future of health care.



Questio
n: As a freelancer or small business owner, one of the reasons I haven't purchased health insurance was because of the enormous cost. How will the new bill change the cost of insurance for those whose income fluctuates based on projects?
--Haasan

Answer: There is some debate about what impact health-care reform will have on the price of health insurance. However, many believe that with insurance being largely mandatory beginning in 2014, prices will fall, particularly since state "exchanges" will also be available at that time. These exchanges will allow individuals and small businesses to aggregate their buying power. There is also a new tax credit for small businesses that may help, as well as tax credits for those making between 100-400% of the federal poverty level. In the aggregate, these changes should increase your options for insurance, and hopefully at a lower overall cost.
Question: How does the new law help parents who have a schizophrenic son in his 30s living with them because he is unable to take care of himself?
--Joe

Answer
: Although the new law will allow parents to extend dependent coverage to children up to the age of 26, that will not help for older adult children. However, you should see an expansion of available plans once the reforms go into effect, particularly once state insurance "exchanges" come into existence in 2014. That -- along with the fact that, effective June 21, 2010, insurers may no longer impose pre-existing condition exclusions -- should give you more options to acquire coverage for your son. Your son will also likely be eligible for new tax credits designed to help those with low income offset the cost of insurance.

Question: I make the most of my flex spending account, about $3,000 for personal things and $5,000 for family care. Is it true that the new law reduces these accounts? What can I do?
--Rob

Answer: Under current law, dependent care flex accounts are capped at $5,000 annually, and medical expense flex accounts have no cap (although most employers implement their own caps, typically at the $5,000-$6,000 level or less). The new health-care law does nothing to change the limits on dependent care accounts, which remain capped at $5,000. However, the law does create a new, $2,500 annual cap on medical expense flex accounts. Those who maxed out these accounts at a higher employer cap will not enjoy the same level of tax-advantaged savings. Note, however, that this change does not take effect until January 1, 2013, so you've got a couple of years to plan for it.
Want to know how health care reform will affect you specifically? Ask us your questions in the comments section below.

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