Angela Godby, Assistant Vice Chancellor for Federal Relations for the University of Texas System.

U.S. Supreme Court Upholds Health-Care Reform Package

On June 28, 2012, the U.S. Supreme Court caught many observers by surprise by upholding the sweeping health-care reform package signed into law in 2010.  The health reform bill aims to provide health insurance coverage to an additional 32 million people.  The law requires all Americans to purchase health insurance or pay a penalty to the Internal Revenue Service.

Twenty six states sued the federal government claiming that the so-called individual mandate was unconstitutional.  The Supreme Court ruled that the individual mandate is a constitutional exercise of Congress' taxing authority.  The Court also held that Congress could not withdraw existing Medicaid funds from states for failure to comply with the Affordable Care Act's expansion of Medicaid, but federal funding remains available to any state that affirms its willingness to participate.

So what does all this mean to FIRST?  The existing law stands.  Over the next few years, key provisions will continue to be implemented.  By 2014, virtually all Americans will have to obtain coverage or pay a tax penalty.  For a single person, the penalty will start at $95 per year or up to 1 percent of income, whichever is greater.  The penalty becomes progressively larger from 2014 to 2016, when it will reach full strength.

Medicaid coverage will stay the same for now.  If you are living in a state that was offering Medicaid to a larger share of the poor than required by federal standards, the law has required your state to lock in those more generous eligibility rules through 2014.  States will have to decide whether to participate in the law's expansion of Medicaid.  If they choose not to participate, they could opt to scale back eligibility rules for the program.

Key provisions of the law are the following:

• the law forbids insurance companies from discriminating against patients for pre-existing conditions
• children under 26 years of age can stay on their parents' insurance
• many preventative screening tests must be covered by insurance with little to no co-pay
• insurance companies cannot use small loopholes in insurance contracts to cancel your plan if you become ill

News on the Hill keeps members current with the legislation in Washington, DC. This column is written by Angela Godby, affected with lamellar/CIE.