Can you describe a few scenarios where the healthcare reform bill will affect regular people on the Central Coast?
It’s no secret that I’m very proud of my vote to reform the health insurance system to provide stable, affordable insurance for all Americans. This reform will help all Americans, even those who already have insurance.
Let’s start with the owner of a small business. She employs 15 people and currently can’t afford to offer coverage. This is all too common. Only about 45 percent of small businesses can afford to offer health benefits, with costs up 129 percent since 2000.
First, businesses with fewer than 50 employees are exempt from the bill’s shared responsibility requirement. We must make sure our small businesses have the capacity to grow, and this bill helps achieve that. Second, the bill provides tax credits to small businesses with fewer than 25 employees and average annual wages below $50,000 that purchase health insurance for employees. Eligible businesses will receive a tax credit for up to 35 percent of the employee’s premium until 2013.
Then, starting in 2014, businesses will be able to shop for coverage on the newly created Health Insurance Exchanges, giving them the purchasing power of big business. Many of their employees will also be eligible for tax credits and subsidies.
How about a young adult, 22 years old, who can’t afford insurance today? As soon as rules are written (within a few months), young adults up to their 26th birthday can remain on their parents’ insurance plan.
Young Americans too often forgo insurance, missing out on preventive care that could keep them healthier. They then rely on emergency room care when something goes wrong. Keeping young Americans insured is an important part of achieving a healthier America.
In addition, starting in 2014, all Americans; regardless of age, will no longer be discriminated against because of pre-existing conditions. And as soon as rules are written, no American can lose coverage if they become sick.
Finally, let’s take a look at a 68-year-old Central Coast resident.
Beginning immediately, the bill starts to close the Medicare Part D “donut hole,” a prescription drug coverage gap that forces many seniors to shoulder the full cost of their medication. Starting this year, any senior who reaches that gap will receive a $250 rebate to help cover costs.
In 2011, steep discounts will be offered on drugs to those who fall into the coverage gap, and the gap will be eliminated entirely by 2020.
Another key part of the bill is the removal of annual and lifetime coverage limits, where insurance companies set ceilings on how much coverage they had to provide. Medicare will also offer free preventive care starting in 2011.
The bottom line is that all Americans benefit from this bill. In the past, even those with insurance weren’t safe from insurance companies who could drop coverage with no notice.
In addition to health reform provisions, the reconciliation bill includes revisions to student aid. Can you tell us more about this?
In addition to change to the Senate’s health insurance reform legislation, the reconciliation bill also makes sweeping reforms to the student loan system, as directed for in the Senate budget resolution.
Because of the prominence of health reform, the student aid portion of the bill isn’t getting a lot of attention. That’s a shame because this reform provides the largest-ever investment in student aid—and it comes at zero cost to taxpayers.
The reform eliminates needless bank subsidies, instead directing the federal government to offer student loans directly and have private banks service them. The government already funds 88 percent of all federal student loans.
By removing bank subsidies for the remaining 12 percent, this bill will save taxpayers $61 billion. Those savings will be directed toward expanding aid for college students and paying down the federal deficit by $10 billion.
The bill overhauls the student aid system by investing in the following programs:
• $36 billion to the Pell Grant program, increasing the maximum grant from $5,350 in 2009 to $5,550 in 2010 and to $5,975 by 2017.
• $2.55 billion for Historically Black Colleges and Universities and Minority-Serving Institutions.
• $2 billion for a competitive grant program for community colleges.
• $750 million to increase access to college, including funds for the College Access Challenge Grant program.
By eliminating needless, wasteful bank subsidies, the reconciliation legislation allows student aid to expand its reach, become more efficient and save taxpayers billions.