• By a 219-212 vote, the House has passed and the President will sign the Senate healthcare reform bill passed by a 60-39 vote in December.  No Republicans voted for the bill.  The House has also passed a reconciliation bill containing proposed changes to the Senate bill.  While some of the details could change depending on the resolution of the reconciliation bill, the key features of healthcare reform have been determined and, barring successful court challenges or repeal, will take effect.
• Some provisions will become effective soon, including prohibition of pre-existing condition exclusions in health insurance for children, allowing young adults to stay on their parents’ insurance until age 26, and creation of a temporary high risk pool with subsidized rates for people without coverage with pre-existing conditions.
• Beginning in 2014:
  • Almost all residents will be required to obtain a minimum amount of health insurance specified by the government or pay a penalty.
  • Most employers will be required to offer coverage to employees or pay a penalty.
  • Eligibility for “free” Medicaid coverage will expand significantly.
  • Premium subsidies will be available for people with incomes up to 400 percent of the federal poverty level who do not qualify for Medicaid.
  • Non-group coverage will be available through state-level “exchanges” where insurers will be approved to offer four levels of coverage.
  • Insurers will not be able to base premiums on or exclude coverage based on health status or pre-existing conditions, and premium rates will only be allowed to vary within a 3-to-1 range based on a person’s age.
• The Congressional Budget Office (CBO) projects that over 30 million people will gain health insurance by 2019 compared with the status quo.  It projects that Medicaid expansion will account for about half of the increase.  It projects that over 20 million people will remain uninsured.
• The cost of Medicaid expansion and premium subsidies will be financed by projected cuts in Medicare spending, including the Medicare Advantage program (where private insurers provide coverage), and by a variety of new taxes and fees.
• The CBO projects that overall federal deficits will decline by over $100 billion through 2019.  It speculates that further reductions will be achieved in the subsequent decade.  Over-half of the projected 10-year deficit reduction is due to creation of a federal long-term care insurance program, which is projected to generate significant premiums and pay little in benefits in the early years of the program.
• The projected Medicare deficit will decline, but most of the reduction will be used to finance coverage expansion.  The CBO is uncertain whether the projected cuts in Medicare will be associated with reduced utilization or quality of care.
• The CBO projects that average health insurance premiums will increase by roughly 10-13 percent by 2016 because the minimum coverage amounts will exceed the amounts of coverage many people with insurance currently purchase.  Insurer-sponsored analyses project much larger increases.

Media Advisory

For Immediate Release

March 22, 2010

Statement by Governor Daniels on passage of federal health care bill

“Our two best hopes for more jobs are investment and small business.  The new ‘health care’ bill raises taxes drastically on both, and will harm our economic prospects badly.  Hoosiers will also face higher state taxes as Medicaid rolls explode. It will raise by trillions the crushing debt we already are leaving young Americans; any claims to the contrary are worse than mistaken, they are knowingly fraudulent.  In a life of optimism about America and its future, this morning I am as discouraged as I can remember being.”