The U.S. Senate Finance Committee has approved legislation that would make significant changes to the healthcare market in the United States.
The legislation (America's Healthy Future Act of 2009) would require all U.S. citizens and legal residents in the United States to purchase healthcare coverage beginning in 2013. Individuals who fail to purchase and maintain healthcare insurance would be subject to an excise tax.
The legislation would create state-based “exchanges” that would direct consumers seeking to purchase coverage in the individual market to all the health plan options available in their zip code. The legislation includes tax credits for low-income and middle-income individuals/families who purchase insurance in the private market. The credits would be the amount required to prevent the individual from having to pay more than a certain percentage of income on premiums, rising from 2 percent of income for those at 100 percent of the federal poverty level to 12 percent of income for those between 300 and 400 percent of the poverty level.
While the legislation doesn't have a requirement for employers to offer healthcare coverage, the legislation would make employers that fail to offer healthcare insurance pay a fee if their employees receive a tax credit for health insurance through a state exchange. The fee would be capped at $400 per employee.
For employers that offer healthcare coverage and have 200 or more employees, there would be a requirement to enroll employees into health plans automatically.
The legislation also includes other significant provisions that would change the healthcare market, such as
- Reforming the insurance market so no one can be denied coverage or charged more because of a preexisting health condition;
- Prohibiting insurance companies from charging women or people who have been sick more for their coverage;
- Eliminating yearly and lifetime limits on the amount of coverage plans provide and make it illegal for insurance companies to drop coverage;
There are several healthcare bills in Congress, so lawmakers will be busy hashing out a final version of the legislation for a possible vote. So far, Republicans have generally opposed the proposed healthcare overhauls.