Saturday, August 8, 2009

HR 3200, Section 122 (Part One)

(a) In General- In this division, the term `essential benefits package' means health benefits coverage, consistent with standards adopted under section 124 to ensure the provision of quality health care and financial security, that--
(1) provides payment for the items and services described in subsection (b) in accordance with generally accepted standards of medical or other appropriate clinical or professional practice;
(2) limits cost-sharing for such covered health care items and services in accordance with such benefit standards, consistent with subsection (c);
(3) does not impose any annual or lifetime limit on the coverage of covered health care items and services;
(4) complies with section 115(a) (relating to network adequacy); and
(5) is equivalent, as certified by Office of the Actuary of the Centers for Medicare & Medicaid Services, to the average prevailing employer-sponsored coverage.
(c) Requirements Relating to Cost-sharing and Minimum Actuarial Value-
(1) NO COST-SHARING FOR PREVENTIVE SERVICES- There shall be no cost-sharing under the essential benefits package for preventive items and services (as specified under the benefit standards), including well baby and well child care.
(A) ANNUAL LIMITATION- The cost-sharing incurred under the essential benefits package with respect to an individual (or family) for a year does not exceed the applicable level specified in subparagraph (B).
(B) APPLICABLE LEVEL- The applicable level specified in this subparagraph for Y1 is $5,000 for an individual and $10,000 for a family. Such levels shall be increased (rounded to the nearest $100) for each subsequent year by the annual percentage increase in the Consumer Price Index (United States city average) applicable to such year.
(C) USE OF COPAYMENTS- In establishing cost-sharing levels for basic, enhanced, and premium plans under this subsection, the Secretary shall, to the maximum extent possible, use only copayments and not coinsurance.
(A) IN GENERAL- The cost-sharing under the essential benefits package shall be designed to provide a level of coverage that is designed to provide benefits that are actuarially equivalent to approximately 70 percent of the full actuarial value of the benefits provided under the reference benefits package described in subparagraph (B).
(B) REFERENCE BENEFITS PACKAGE DESCRIBED- The reference benefits package described in this subparagraph is the essential benefits package if there were no cost-sharing imposed.”
1. The “private option” has to meet the following standards:
a. It must provide certain benefits, to be outlined below.
b. “Cost sharing” is the term used to describe the ways insurance companies pass costs on to their enrollees to account for increasing medical costs. These methods include co-pays, annual limits on what they will cover, etc.
c. Under this bill, insurance companies will not be allowed to cost-share with an enrollee unless that enrollee spends more than $5,000 in one year on health care, or the enrollee’s family spends more than $10,000. This number adjusts upward each year, based on the consumer price index.
d. No matter how much well-baby care or well-child care or any other preventive care a person receives, even if it’s a million dollars each year, a private insurance company can’t charge them a penny in cost-sharing for it. These costs just get passed along to everybody else through higher premiums. More nails in the private insurance coffin.
e. They will not be able to impose any limits on what they will cover, either annually or lifetime. If you want it, they have to give it (and then pass their costs on to everybody else).
This is socialized medicine by proxy – using a private entity to do the dirty work for them. In this sense, they aren’t destroying the private insurance market, any more than a virus destroys its host cell. They will simply ruin the private insurance market by imposing regulations that create socialized medicine through them.
f. Private insurance has to be “equivalent” to the “average” employer-provided coverage in a particular area. It can’t be worse, but it can’t be any better, either. We’re all in the same crummy boat.

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