Many positive changes have been introduced in the health care reform, which is seen as a major victory for the Obama administration. It will ensure that more people can take advantage of health insurance, but it would also mean higher contribution from employers.
One of the changes would be in the dependant coverage age, that is, the age till which employers have to provide coverage to dependants. Currently, this age varies from one state to another and is usually as low as 22. However, the dependant coverage age will become 26 from 2011 and will be uniform for all the states, except for those who have an even higher age limit.
Another welcome change is that employers who currently give health insurance with a lifetime maximum limit would not be able to do so under the new law. This implies that employees need not be concerned about medical expenses even if they suffer from a serious illness that has a very expensive treatment.
The new law also takes a stricter view on misuse of health saving accounts (HSA) money. Often, employees use the HSA money for non-medical purposes. The penalty for doing the same would be doubled under the new law and would stand at twenty percent of the value of the claim.
The negative side of the new law is that it will increase the monetary burden on employers. The increase in the dependent coverage age and the removal of the lifetime cap means that employers would have to spend more for health insurance of employees and their families. The impact of the increase in costs could be felt by the workers too. They might have to bear higher premium and deductibles because of these new measures, as employers will try to pass on this cost increase to their workers.
The government had started a program in which employees were reimbursed the amount that they spent on buying over the counter drugs. The reimbursement was made from the HSA or flexible spending accounts (FSA). This program will be removed soon, which is again bad news for employees.
The new law also puts a cap on employee and employer contribution towards FSA. However, these caps are much higher than the current average FSA contributions and it is not expected to become a major problem in the near future.
So be prepared for all these changes. You might soon start receiving communication from your employer regarding these.
The changes that remove the lifetime maximum limit on coverage are very important for ensuring stability for employees. Health care costs can easily become unmanageable for those who become ill and as the largest cause of bankruptcies in the US, this measure is long overdue. Given that few of us will know in advance how sick we might get, there is no reasonable way for individuals to purchase only the insurance that they will “need”.