Healthcare Blog

Boomer Healthcare

Hello fellow Boomers and Happy New Year!!! Below is a letter I'm mailing my clients regarding health care for 2009. I plan to make available updates on how health insurance and healthcare delivery could be impacted at the Federal legislative level this year. This is my thirtieth year in this industry and have seen a lot of changes. Believe me, whatever happens will affect our Boomer Generation! BIG TIME!!!

Best regards,
Denny
Cincinnati

DATE: January 2, 2009
FROM: Dennis J. Riedmiller, President & CEO
RE: Health Care for 2009


This year will be a challenging year for sponsors of healthcare plans, including those with individual policies, Medicare and Medicaid in the U.S. Many of our clients are asking for answers in how to prepare for Congressional reform in our healthcare insurance, delivery system and tax structure. What American health care and insurance will look like is anybody’s guess. Ideas are many, but answers are few. The Galen Institute, a national research group, has come up with a brief synopsis of the Congressional Budget Office proposals in Washington and how those changes will affect government expenditures. Here is a brief overview out of 115 choices for healthcare reform we want to make you aware of:

Tax Caps
Limiting the amount of money people can protect from income and payroll taxes for purchasing health insurance to $1,440 a month for family coverage and $565 for individuals would bring in $452 billion in revenues over 10 years. The numbers would be indexed for inflation

Tax Credit
Replacing the healthcare exclusion with an advanceable, refundable tax credit worth 25% of the cost of the premium, could bring $606 billion more into federal coffers over 10 years.

HSAs
The government could increase its revenues by $10.5 billion over 10 years by disallowing new contributions to Health Savings Accounts

Play-or-pay mandate
Imposing a mandate on employers to provide health insurance to their workers would bring in $48 billion in additional venues to the federal government, primarily in fines from those who don’t comply.





Government reinsurance
The idea of having the federal government ‘reinsure’ private insurance by taking over payment for high–cost medical claims would cost the federal government $752 billion over ten years and lead to only 2.6 million more people getting insured. This could lead to federal price-setting throughout the private health insurance market, and big price tag for taxpayers.

Medicare Part D
Eliminating the donut hole in the Medicare prescription drug benefit would cost $134 billion over 10 years.

Drug rebates
Expanding the Medicaid rebate program to the Medicare drug benefit would save the government $110 billion over 120 years. However, this could reduce the amount of funds that companies invested in research and development.

Medicare buy-in
Allowing people aged 62 to 64 to buy into Medicare and would cost $1.2 billion over 10 years, but it would be another big expansion of a price-controlled, bankrupt government program.

Comparative effectiveness
Creating a new comparative effectiveness program would cost less than $1 billion over the period, but depending on how it is structured, could dramatically centralize and politicize decisions about the medical care available to all of us.

AHPs
Creating Association Health plans would cost the government just $220 million over 10 years and lead to 600,000 more people getting health insurance.

Cross-state purchasing
A provision allowing people to purchase their own health insurance in any state. A 7.4 billion savings to the federal government, with 400,000 more people getting insurance.

Medicare modernization
Changing Medicare from a defined-contribution to a premium-support system would reduce federal spending by $161 billion over 10 years.

Whatever the shape of reform will take, Riedmiller & Associates want to assure you we will keep you informed and assist you with any changes.

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