After reform, Americans would get their health coverage from exactly the same sources they do today: private insurance for middle-income non-elderly households, Medicaid for low-income people, and Medicare for seniors (plus military and Indian health care for those groups). What will change: reform will provide a mixture of new public and private financing to help make private coverage affordable to the tens of millions who can’t pay for it today, and introduce important new consumer protections.
No new government programs
The bills do contain a significant expansion of our nation's Medicaid program by allowing very-low-income working adults to enroll. Most of these citizens and long-time legal residents are not eligible now, no matter how poor they are. Recognizing that states are in no shape to fund their normal share of Medicaid coverage, the proposal provides full federal funding for these newly eligible persons from 2014, when this change takes effect, through 2017, phasing down to 90% federal funding level in 2020.
Private coverage expands under reform
The proposed reforms would add 15 million people to the rolls of private insurers, giving these new enrollees access to private-sector doctors and hospitals. Employer-provided coverage is preserved, as is the coverage you buy on your own. In fact, if you like the coverage you buy today, you can keep it because it is grandfathered in.
The reforms improve how private coverage works for consumers by introducing significant new consumer protections and making these protections more uniform across the 50 states. These new rules will also make the private insurance marketplace more competitive and make insurance products more transparent to consumers.
Finally, the government would provide new tax credits to help middle and lower income families purchase private insurance if they don’t have access to coverage from a job. If you are tempted to point to this as a government takeover of health care, be careful! You should know that employer provided coverage—the type of coverage most of us have—already enjoys a large government subsidy in the form of being excluded from taxable income.
Bottom line for consumers
The mixed public and private system envisioned under reform is, in reality, what we already have. While most insured Americans have coverage through a private plan, a sizable minority (30 percent) are covered by current government programs that finance care for the poor, the elderly, and the severely disabled.
—Lynn Quincy, Senior Policy Analyst
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