Click the bill for a copy of the healthcare bill:

Confused about the healthcare reform effort?   Don’t worry – you’re not alone. Health legislation will be twice as long and half as intelligible, as Tolstoy’s masterwork “War and Peace.” And news coverage of healthcare reform has focused as much, or more, on political wrangling than on substance. So we’re going to try to describe what’s in the healthcare reform bill in plain English.

      That’s not easy. For one thing, the bill is full of sentences that begin “For the purposes of subparagraph 6(b)....” For another, healthcare reform would be the most sweeping change in US domestic policy in a generation. It’s big, and it’s complicated. Healthcare 101: What the bill means to you

But here’s a key thing to remember: There is a simple concept at the center of this rambling,. healthcare reform would expand insurance coverage in America by requiring people to obtain it.    That’s right. The healthcare reform bill would mandate that most US citizens and legal residents purchase “minimal essential coverage” for themselves and their dependents. Either they can get this through their employer, or, if their employer doesn’t offer health insurance, they can buy it through new marketplaces that will sell policies to individuals. Those marketplaces would be called “exchanges.” We’ll talk more about them later. (We’ll also cover subsidies for health insurance, when it all would take effect, how it would be paid for, and what it means for businesses.) 

Are  there penalties if you don't buy insurance?

If you ignore this mandate and don’t get health insurance, you’ll have to pay a tax penalty to the federal government, beginning in 2014. This fine starts fairly small, but by the time it is fully phased in, in 2016, it is substantial. An Insurance-less person would have to pony up whichever is greater: $695 for each uninsured family member, up to a maximum of $2,085; or 2.5 percent of household income. 
There are exceptions. Certain people with religious objections would not have to get health insurance. Nor would American Indians, illegal immigrants, or people in prison.

Why the requirement? 
Why is Congress doing this? It’s a pretty obvious way to expand coverage, for one thing. Also, it will help bring in a flood of new customers for health insurance firms, including healthy young people who might not need much healthcare.  For insurance firms, those new customers could balance out the losses they will incur if they can no longer deny coverage to people with preexisting conditions. (Yes, that’s another change the bill makes.)

And remember, many people will not be buying this coverage purely on their own. Uncle Sam will be helping them. The bookend to the individual mandate is federal subsidies for insurance purchases, which reach deep into the middle class.  (And our pocket books as well)  We’ll talk about those next. Health care reform bill 101: Who will pay for reform?

For the United States, health care reform would come with a hefty co-pay.

Change like that doesn’t come cheap. More specifically, change like that would cost about $940 billion over its first 10 years, according to the Congressional Budget Office.     Add these two things together, throw in $40 billion worth of tax credits for small business, and you’re pretty close to the bill’s top line for expansion of health coverage.     So where’s the cash to pay for this coming from? Remember, CBO says this bill will actually cut the deficit over 10 years. That means it has to raise a little more money than it will spend.     The answer is that the money will be provided by new taxes, fees on industries involved in health care, and cuts in projected spending growth for existing government health efforts, primarily Medicare.

Higher Medicare taxes on Higher Income people 

If you are an individual making more than $200,000 a year, or a married couple making more than $250,000 a year, get ready to pay more for your Medicare if health care reform passes.

     First of all, your Medicare Part A (that’s hospital insurance) tax rate would be increased by 0.9 percent, to 2.35 percent. Second, the bill creates an entirely new tax of 3.8 percent on unearned income (dividends, interest, stuff like that) for people in those same income brackets.  The good news is that this would not take effect until Jan. 1, 2013. And it is a big money raiser, truth be told. The Joint Committee on Taxation estimates this would bring in $210 billion between 2013 and 2019.

New tax on expensive health insurance

They used to call this the “Cadillac tax,” but it’s been pared back enough so it might better be called the “Chevy with leather and A/C” tax.     The health care bill would impose an excise tax on insurers of employer-sponsored health plans that cost more than $10,200 annually for individual coverage, or $27,500 annually for family coverage. The tax in question would be 40 percent of the cost of the plan that exceeds those dollar thresholds.

     This tax would not kick in until 2018. The JCT figures it would bring in around $32 billion in its first two years.
Fees on health care industries

     The Obama administration figures it is only fair to slap some fees on health care industries, since they’d be getting lots of new customers. So after negotiations with some big sectors, the White House struck a number of deals ~
.•Drug manufacturers would pay the US a total of $16 billion between 2011 and 2019.
• Health insurers would pay $47 billion over the same period.
• Medical device manufacturers would pay a 2.9 percent excise tax on the sale of any of their wares, beginning Jan. 1, 2013.The tanning tax

OK, it’s not a big money raiser, but we could not resist mentioning that health care reform would establish a tax of 10 percent on indoor tanning services.
(Outdoor tanning services remain untaxed, of course. ) This would raise $2.7 billion between 2010 and 2019.Medicare cuts

Government payments to Medicare Advantage – plans run by private insurers that are an alternative to traditional Medicare – would be reduced by $132 billion over 10 years under the health care reform bill. (Those plans now get around 14 percent more per person than traditional Medicare does.) Medicare payments for home health care would also be reduced by $40 billion over 10 years. And cuts in certain payments to hospitals would raise another $22 billion by 2019.

Health care reform bill 101: What will it mean for business?                                                                                                

Critics have alleged that the health care reform bill set to be voted on by the House Sunday is a job killer. 
What's the reality? It could affect some businesses heavily.
Maybe you own a dry cleaning shop. Or a restaurant. Or a small factory that makes, oh, bearings for wind turbines.
Maybe you’re the CEO of a larger firm – a utility, or a toolmaker, or even Google.

Quite a bit.  It could affect business decisions on health coverage for employees at tens of thousands of firms.
Let’s start with a caveat: that dry cleaner, and probably the restaurant, might be too small to be affected by some of the most important business-related elements in the bill. Employers with 50 or fewer workers would be exempt from coverage provisions.

     But for top executives at firms with 50 workers or more, the most important question may be this: would the health care reform bill require us to offer health insurance to our employees?     The answer to that is “no,” strictly speaking. But if you don’t, you might have to pay fairly large fees to Uncle Sam.How does the bill work for businesses?  

Here’s how that works: If you are a firm with more than 50 employees, and do not offer health insurance as a benefit, and at least one of your full-time employees gets a subsidy from the federal government to purchase health insurance on his or her own, you would have to pay Washington a fee of $2,000 for every one of your full-time workers. (Company accountants take note: you could subtract the first 30 of your employees from that assessment.) Got that?
      Also, even if you do offer coverage, you might have to take some extra action to help any of your low- or middle-income workers who want to buy insurance on their own.
     Take an employee who makes less than 400 percent of the federal poverty level, which today is about $10,800 for an individual or $22,000 for a family of four.
     Perhaps that employee is finding firm-offered insurance expensive. If their share of health premiums is more than 8 percent of their income (but less than 9.8 percent), they would have the option of going out and buying insurance on their own through the new-fangled “exchange” marketplaces the health care reform bill would establish.
     And you, as an employer, would have to help them. You’d have to provide them a “free choice voucher” equal to what the firm would have kicked in to provide coverage in the company plan.

When do the changes take effect?

All of the above changes would take effect beginning on Jan. 1, 2014. One final item: if you’re a firm with more than 200 employees, and you do offer health insurance, you would have to automatically enroll your workers in the plan.
    They could opt out of the coverage.
But they are the ones that would have to make that decision. Health care reform bill : Will it make health care more effective?
    Buried within the massive new US health care reform law is a small provision that in years to come could have a major effect on the kinds of treatments that American patients receive.

     The provision requires the federal government to set up something called a “Patient-Centered Outcomes Research Institute.” It sets aside $500 million in seed money for this new nonprofit organization, which is supposed to become a national guiding force for comparative effectiveness research.     What’s that? Simply put, comparative effectiveness research takes a particular health problem, then pits different ways of treating that problem against one another, in an attempt to find which, if any, is a more effective way to maintain or restore patient health. 

Healthcare 101: What the bill means to you

Yes, it does sound a little like “American Medical Idol,” doesn’t it? But let’s not trivialize a serious subject.)     It’s true that the point here is to save money as well ensure successful outcomes for patients. Supporters of comparative effectiveness research believe it’s a no-brainer way to figure out whether cheaper drugs, medical devices, or surgical techniques work just as well as fancy, expensive ones.     Prices for medical care stay low, patients and insurers pay less, so the cost curve of healthcare gets bent downward. Everything would be good, right? And in fact, the US already funds lots of research in this area. There was more than $1 billion for grants for comparative effectiveness studies in the stimulus package, for instance.

The new centralized organization funded by the health reform law simply is supposed to be a headquarters for this effort, by directing studies, then synthesizing and disseminating results.

     Not so fast, say opponents. They worry that this whole thing could lead to rationing of care – particularly new, expensive treatments.     That is why the just-enacted health reform law also contains language saying that findings from this new institute can’t be construed as mandates for particular treatments, and can’t be used as an excuse to deny coverage of particular treatments.    

The new institute will be run by a 19-member board of directors chosen by the US Comptroller General.
It is supposed to be up and running within six months.