Health Care Reform Update

On the heels of Obama’s health reform news, a new health care bill is being created by the White House and congressional Democratic leaders. Administration officials are saying that this bill will cover limits on medical loss ratios along with cuts in the Medicare Advantage program and a tax on so-called Cadillac plans. In the meantime, Obama’s team continues to press for health care legislation and reform.

Whether or not the White House will use the Congressional reconciliation process has yet to be determined. If they do utilize it, the votes required to secure passage in the Senate would be reduced to 51. This process will expire in April.

If the bill passes, it will ban lifetime limits on benefits but does not discuss annual limits. In addition, the proposed bill would ban discrimination based on preexisting conditions, and limit premium differences based on age. Industry sources indicated that the plan also would propose cuts in the Medicare Advantage program; tax credits to small businesses to purchase insurance; a reduction in the doughnut hole for Part D, the prescription drug program under Medicare; and a tax on the excess of Cadillac plans’ value.

Stay tuned!