What happens when (Reform)

I’m getting so many questions about what goes into effect when with respect to health care reform.  Luckily, Austin Frakt did the heavy lifting for me:

What Happens When

(source: Kaiser Health Reform Gateway summary, many details omitted, assumes enactment in March 2010)

Immediately upon enactment or for tax year 2010

  • Medicare Part D donut hole begins to close ($250 rebate in 2010, coinsurance rate reduces from 100% to 25% by 2020).
  • Small business tax credits.
  • Loss ratio/premium rate increase reviews with consumer rebates if minimums not met (loss ratio minimums: 85% for plans in the large group market and 80% for plans in the individual and small group markets).
  • Comparative effectiveness research funding.

June 2010

  • Temporary high risk pool (until 2014) to provide health coverage to individuals with pre-existing medical conditions ($5 billion in appropriations for funding; maximum cost-sharing limited to $5,950/individual and $11,900/family in 2010).

September 2010

  • Require dependent coverage option for children up to age 26 for all individual and group policies.
  • Prohibit individual and group health plans from placing lifetime limits on the dollar value of coverage.
  • Prohibit insurers from rescinding coverage except in cases of fraud.
  • Prohibit pre-existing condition exclusions for children.


  • Phase-in of lower Medicare Advantage payment rates.
  • Eliminate cost sharing for preventive services under Medicare and Medicaid.


  • Quality-based payments under Medicare to accountable care organizations (ACOs).


  • Increase Medicare tax (to 2.35% on earnings over $200,000 for individual taxpayers and $250,000 for married couples filing jointly and impose a 3.8% tax on unearned income for higher-income taxpayers).
  • Elimination of employer Part D retirement drugs subsidy.
  • Medicare bundled payment pilot program.


  • Expand Medicaid to individuals and families with incomes up to 133% of the federal poverty level with increased federal payments to states.
  • Create state-based insurance exchanges and exchange premium and cost sharing credits for individuals and families with incomes up to 400% of poverty.
  • Individual mandate penalties begin (phased in from $95 in 2014 to 2.5% of taxable income in 2016).
  • Employer mandate penalties begin (for employers with 50+ employees that do not offer coverage: $2,000 per full-time employee, excluding the first 30 employees from the assessment; for employers with more than 50 employees that offer coverage but have at least one full-time employee receiving a premium tax credit: the lesser of $3,000 for each employee receiving a premium credit or $750 for each full-time employee).
  • Medicare Payment Advisory Board begins to submit recommendations for Medicare payment reductions if spending exceeds determined thresholds.


  • Excise tax on insurers (40% tax on plans with aggregate values above $10,200 for individual coverage and $27,500 for family coverage, indexed to CPI-U).
  • Go read his blog and thank him for the hard work!

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