What does the new health care law mean for letter carriers and their families this year?

The comprehensive health care legislation signed into law by President Obama on March 23, 2010, will be phased in over the next few years, which will allow the state governments to set up health exchanges similar to the FEHBP program that will let workers and small businesses choose among competing private insurance plans as well as one or two non-profit health plans. It will eventually help reduce postal employee health premiums, which are inflated by the need to pay for car given to the uninsured, by requiring many employers and all individual Americans to purchase health insurance if their employers don’t provide coverage. But many of the most important progressive reforms will take effect this year.  These include: 

• This year, this bill starts to close the Medicare Part D "donut hole" by providing a $250 rebate to Medicare beneficiaries who hit the gap in prescription drug coverage. And beginning in 2011, the bill institutes a 50 percent discount on prescription drugs in the "donut hole."

• This year, children with pre-existing conditions can no longer be denied health insurance coverage. Once the new health insurance exchanges begin in the coming years, pre-existing condition discrimination will become a thing of the past for everyone.

• This year, insurance companies will be banned from dropping people from coverage when they get sick, and they will be banned from implementing lifetime caps on coverage.

• This year, restrictive annual limits on coverage will be banned for certain plans. Under health insurance reform, Americans will be ensured access to the care they need.

• This year, adults who are uninsured because of pre-existing conditions will have access to affordable insurance through a temporary subsidized high-risk pool.

• This year, this bill creates a new, independent appeals process that ensures consumers in new private plans have access to an effective process to appeal decisions made by their insurer.

• This year, discrimination based on salary will be outlawed. New group health plans will be prohibited from establishing any eligibility rules for health care coverage that discriminate in favor of higher-wage employees.

• This year, small businesses that choose to offer coverage will begin to receive tax credits of up to 35 percent of premiums to help make employee coverage more affordable.

• This year, new private plans will be required to provide free preventive care: no co-payments and no deductibles for preventive services. And beginning January 1, 2011, Medicare will do the same.

• This year, this bill will provide help for early retirees by creating a temporary re-insurance program to help offset the costs of expensive premiums for employers and retirees age 55-64.

• In the next fiscal year, the bill increases funding for community health centers, so they can treat nearly double the number of patients over the next five years.

• Starting January 1, 2011, insurers in the individual and small group market will be required to spend 80 percent of their premium dollars on medical services. Insurers in the large group market will be required to spend 85 percent of their premium dollars on medical services. Any insurers who don't meet those thresholds will be required to provide rebates to their policyholders.

• Starting January 1, 2011, health care plans will allow young people to remain on their parents' insurance policy up until their 26th birthday.

• Starting in 2011, this bill helps states require insurance companies to submit justification for requested premium increases. Any company with excessive or unjustified premium increases may not be able to participate in the new health insurance exchanges.

The legislation signed by the president was the bill passed by the Senate, which contained many serious flaws, including an onerous excise tax on high-cost plans that could adversely affect FEHBP plans in the future. However, the House passed on March 21 and the Senate passed on March 25 a package of improvements that dramatically strengthen the new health care law. President Obama signed this second bill into law March 30.