US Agencies Issue Health Insurance "Grandfather Rule"

Americans who like their health insurance plans for whatever reasons, whether they are affordable or provide good benefits, can now keep it. Today the U.S. Departments of Health and Human Services, Labor, and Treasury issue "grandfather rule" health insurance plan under under the Affordable Care Act that will allow Americans to keep their current health insurance plans or choose a new plan while extending important new benefits.
The U.S. Departments of Health and Human Services, Labor and Treasury today issued a new regulation that makes good on President Obama's promise that Americans who like their health plan can keep it.
The new regulation protects the ability of individuals and businesses to keep their current plan while providing important consumer protections that give Americans - rather than insurance companies - control over their own health care. The new regulation also provides stability and flexibility to insurers and businesses that offer health insurance coverage as the nation transitions to a more competitive marketplace in 2014 when businesses and consumers will have more affordable choices through exchanges.
"The Affordable Care Act gives American families more control over their health care by providing greater benefits, cost savings and protections," said Secretary of Health and Human Services Kathleen Sebelius. "Today, with the announcement of the new 'grandfather' rule, we're providing the market stability and flexibility to ensure that families and businesses can make the choices that work best for them."
While the Affordable Care Act requires all health plans to provide important new benefits to consumers, under the law, plans that existed on March 23, 2010 are exempt from some new requirements. The "grandfather rule" issued today makes it clear that these plans can continue to innovate and contain costs by allowing insurers and employers to make routine changes without losing grandfather status. Plans will lose their "grandfather" status if they choose to significantly cut benefits or increase out-of-pocket spending for consumers - and consumers in plans that make such changes will gain new consumer protections.
"The rule we are announcing today will allow employers to make routine and modest adjustments to co-payments, deductibles and employer contributions to their employees' premiums without forfeiting grandfather status. This flexibility will encourage employers to continue offering health coverage to their employees and help to ensure coverage for all Americans," said Secretary of Labor Hilda Solis.
All health plans - whether or not they are grandfathered plans - must provide certain benefits to their customers for plan years starting on or after September 23, 2010 including:
* No lifetime limits on coverage for all plans;
* No rescissions of coverage when people get sick and have previously made an unintentional mistake on their application; and
* Extension of parents' coverage to young adults under 26 years old;
For the vast majority of Americans who get their health insurance through employers, additional benefits will be offered, irrespective of whether their plan is grandfathered, including:
* No coverage exclusions for children with pre-existing conditions; and
* No "restricted" annual limits (e.g., annual dollar-amount limits on coverage below standards to be set in future regulations).
"The Affordable Care Act positions consumers, instead of insurance companies, as decision makers when it comes to their health care," said Assistant Treasury Secretary for Tax Policy Michael Mundaca. "The rule we're announcing today preserves individuals' ability to keep their current plan and provides strong consumer protections that give Americans more control over their health insurance choices."
Grandfathered health plans will be able to make routine changes to their policies and maintain their status. These routine changes include cost adjustments to keep pace with medical inflation, adding new benefits, making modest adjustments to existing benefits, voluntarily adopting new consumer protections under the new law, or making changes to comply with State or other Federal laws. Premium changes are not taken into account when determining whether or not a plan is grandfathered.
Plans will lose their grandfathered status if they choose to make significant changes that reduce benefits or increase costs to consumers. If a plan loses its grandfathered status, then consumers in these plans will gain additional new benefits including:
* Coverage of recommended prevention services with no cost sharing; and
* Patient protections such as access to OB-GYNs and pediatricians without a referral by a separate primary care provider.
Details about what routine changes insurers and employers can make without losing their grandfathered status, and the projected impact on large and small employer plans and the individual plan market can be found at http://www.healthreform.gov/newsroom/keeping_the_health_plan_you_have.html.
Most of the 133 million Americans with employer-sponsored health insurance through large employers will maintain the coverage they have today. Additionally, large employer-based plans already offer most of the comprehensive benefits and consumer protections that the Affordable Care Act will provide to all Americans this year - such as preventing rescission of coverage.
The roughly 42 million people insured through small businesses will likely transition from their current plan to one with the new Affordable Care Act protections over the next few years. Small plans tend to make substantial changes to cost sharing, employer contributions, and health insurance issuers more frequently than large plans. To help small businesses afford employee coverage, the Affordable Care Act includes a tax credit for up to 35% of their premium contributions.
The 17 million people who are covered in the individual health insurance market, where switching of plans and substantial changes in coverage are common, will receive the new protections of the Affordable Care Act sooner rather than later. Roughly 40 percent to two-thirds of people in individual market policies normally change plans within a year. In the short run, individuals whose plan changes and is no longer grandfathered will gain access to free preventive services, protections against restricted annual limits, and patient protections such as improved access to emergency rooms.
In 2014, small businesses and individuals who purchase insurance on their own will gain access to the competitive market Exchanges. These Exchanges will offer individuals and workers in small businesses with a much greater choice of plans at more affordable rates - the same choice as members of Congress. In fact, the Congressional Budget Office (CBO) has estimated that, on an apples-to-apples basis, premiums will be 14- 20 percent lower than they would be under current law in 2016 due to competition, lower insurance overhead, and increased pooling and purchasing power. Small businesses also will have more affordable options. CBO has estimated that a family policy for small businesses would be available in the Exchanges at a premium that is $4,000 lower than under current law in 2016.
These reduced premiums do not take into account the tax credits available to small businesses and middle class families to help make insurance affordable. These additional new choices and cost savings may further lower the likelihood that small businesses workers will remain in grandfathered health plans. Consumers insured through large employers are more likely to remain in grandfathered plans in 2014 and beyond.

Minnesota Governor Proposes Health Care System Changes

MinnesotaGov. Tim Pawlenty (R) on Tuesday said that legislation being considered tooverhaul the state's health care system should include health savings accountsand tax credits as a way to reduce costs for residents who purchase private healthinsurance, the Minneapolis Star Tribune reports. The measures are similarto those that presumptive Republican presidential nominee Sen. John McCain(Ariz.) proposed on Monday under his health care plan, which aims to expandhealth care through "market-based competition," the StarTribune reports. Pawlenty proposed the measures to a legislativeconference committee that is trying to resolve differences between similarversions of a health care bill approved by the state House and Senate.

Brian McClung, a spokesperson for Pawlenty, said that the tax credits would beoffered to individual residents and small-business owners as an alternative toexpanding public health programs, such as MinnesotaCare. Pawlenty also proposed offering HSAs to stateemployees. However, Jim Monroe, executive director of the Minnesota Association of Professional Employees, said that idea "won't flyvery far with unions."
Conference committee co-chairs Rep. Tom Huntley (D) and Sen. Linda Berglin (D)were divided on how Pawlenty's proposals are helping to shape the health carelegislation. Huntley said, "I'm very optimistic. I think we're moving muchcloser to a bill that we can pass and the governor will sign." However,Berglin said, "An awful lot is pretty vague," adding, "A taxcredit sounds fine but won't really help people much" (Wolfe, Minneapolis StarTribune, 4/30).

Self Esteem Linked to Good Health Declines at age 60

Self esteem - linked to better health, less depression, and even criminal behavior - is important for success in life, but declines after we reach age 60. The findings are important for targeted interventions that can keep self esteem and good health intact throughout life.
Self esteem is lowest in young adults, increases with aging and then begins to decline at age 60. After retirement self esteem becomes even lower, thought to be the result of several factors. Co-author of a study published in the Journal of Personality and Social Psychology, Richard Robins, PhD, of the University of California, Davis says, "In contrast (to self esteem that peaks in mid life), older adults may be experiencing a change in roles such as an empty nest, retirement and obsolete work skills in addition to declining health."
A total of 3,617 US adults were surveyed four times between 1986 and 2002. Using questions like “At times I think I am no good at all" and "All in all, I am inclined to feel that I am a failure”, the researchers were able to draw conclusions about self esteem that peaks in middle age and then begins to decline among older adults.
The surveys also focused on life changing events such as job loss, death of a loved one or being the victim of a violent crime. Also included were questions about ethnicity, education, income, and work status, satisfaction with relationship, marital status, health, and social support.
Women were found to have lower self esteem compared to men until age 80 to 90. Despite income and health, black, compared to whites, had lower self esteem in old age, but fared the same throughout young adulthood and middle age. Happy relationships, health, better income and education all had an impact on how satisfied with themselves individuals surveyed were, that still declined with age.
Aging causes a drop in self esteem after the researchers made multiple adjustments, even for those in happy relationships. Although they enter old age with higher self-esteem and continue to have higher self-esteem as they age, they decline in self-esteem to the same extent as people in unhappy relationships," said co-author Kali H. Trzesniewski, PhD, of the University of Western Ontario. "Thus, being in a happy relationship does not protect a person against the decline in self-esteem that typically occurs in old age."
For baby boomers, self esteem may last into old age, suggest the researchers. Advances in healthcare, combined with working and earning longer might make a difference for keeping self esteem intact, in turn producing better health.