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Touting the Benefits of Health Reform at This Year’s State of the Union

President Obama Should Remind Congress That Reform Is Working

President Barack Obama urged Congress to “get it done” during last year’s State of the Union address. He wanted Congress to work through unresolved conflicts and pass comprehensive reform of the American health care system. Less than two months later he signed the Affordable Care Act into law, which ushered in a series of significant changes in American health care.

Since then, the Department of Health and Human Services and other parts of the executive branch have begun to implement the new law. But health care reform remains a high-profile issue. The House of Representatives just voted to repeal the new law and the new patient’s rights and protections it contains. This would be a giant step backwards.

President Obama needs to remind senators and representatives why the health reform law was necessary in this year’s State of the Union. He can cite the many benefits the law has delivered for the American people.

Signature achievements that are already in place include:

  • Establishing pre-existing condition insurance plans in every state so that individuals with health problems who cannot find coverage in the regular market have a reliable source of coverage
  • Requiring employer-sponsored health plans to offer coverage to the young-adult children of policyholders
  • Helping employers with unpredictable health care spending for retired workers
  • Providing more than 2 million rebate checks to Medicare enrollees who incurred high out-of-pocket prescription drug spending in 2010
  • Prohibiting health insurance plans from denying coverage to children with pre-existing conditions
  • Protecting individuals with high health care costs from the financial risk of absurdly low annual and lifetime limits on their benefits
  • Prohibiting health insurance plans from rescinding coverage when a policyholder gets sick

More changes are in store this year. The president should remind Congress of the improvements that came into place only three weeks ago:

Closing the Medicare prescription drug coverage gap. Seniors and people with disabilities who obtain prescription drug coverage through Medicare Part D now enjoy a new discount on brand-name and generic prescription drugs when they hit the so-called “doughnut hole” in their Part D benefits. Since the beginning of the program, enrollees have hit a gap in coverage when their total drug spending—including out-of-pocket costs and expenses covered by their Medicare Part D plan—exceeds a preset limit (currently $2,830). Patients then pay the total cost of their prescription drugs without help from their drug plan until their total drug expenses hit an upper limit and coverage kicks in again.

With the new discount, people with drug spending high enough to hit the coverage gap will save almost $500 on average this year, while people with very high drug costs will save more than $1,500.

Launching new prevention benefits for Medicare enrollees. Good coverage of preventive services helps seniors and other Medicare enrollees better manage their health. New benefits include coverage without cost-sharing for recommended preventive services (those that receive an “A” or “B” rating from the U.S. Preventive Services Task Force) and new coverage for a personal prevention plan.

Increasing access to primary care. Medicare has begun paying primary care providers a 10 percent bonus payment, which offers a new incentive for physicians, nurses, and others to provide primary care services.

Requiring insurers to provide high value for premium dollars. This year, insurers will pay rebates to policyholders—individuals and employers—when plan spending on clinical services falls below 80 percent of premium revenue in the individual and small group market, and 85 percent of premium revenue in the large group market.

Health reform provisions that will help people every day will continue coming on-line through 2011. These include providing more consumer information on healthy food choices by requiring chain restaurants and vending machines to provide nutritional data no later than March, and improving long-term care by sending enhanced federal Medicaid payments to support new state investments in community-based long-term care services starting in October. Tangible improvements will continue beyond this year, such as fully closing the coverage gap in Medicare Part D and improving Medicaid coverage for preventive care.

The president should also remind Congress that the Affordable Care Act’s most striking impact will come in 2014 when new health insurance exchanges launch, premium subsidies become available, and Medicaid coverage expands to include all low-income individuals regardless of family composition, age, or disability status. At this point, affordable, high-quality health insurance coverage will be within reach for all Americans—an important step toward seizing control over growing health care costs.

These headline-grabbing changes are still around the corner. But President Obama can emphasize during this year’s address how many millions of Americans are already benefitting from the Affordable Care Act and the millions more who will receive better care in the near future thanks to the new law.

Karen Davenport is Director of Health Policy at American Progress.

For more State of the Union policy suggestions see:

Finding Realistic Deficit Reduction by Michael Ettlinger

Education Priority Number One for Congress in 2011: Reauthorize ESEA

Clean Energy Progress Without Congress by Daniel J. Weiss

Scale Back the Defense Budget by Lawrence J. Korb and Laura Conley

Exceptionally American Competitiveness by Sarah Wartell Rosen, Ed Paisley, and Kate Gordon

Smarter Enforcement, More Targeted Measures by Marshall Fitz and Angela Kelley

Outlining a Strategy for Peace by Caroline Wadhams