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What You Need To Know About Health Care Reform

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What Obamacare really means for you and your granny

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Here are 7 big facts you need to know now about the health care reform proposal.

Fact 1: If You Have Insurance Now, You Can Keep It

If you already have private health insurance as a company benefit, this bill won't change your life much.

That is, just as in the current system, your company might change its coverage plan, whether you like it or not. Under the reform plan, it might have an added incentive to switch to a cheaper new plan. Even that possibility is several years in the future, as the plan focuses on expanding coverage to the uninsured first.

If you buy your own insurance now, you can keep your plan.

Cigna (CI), Aetna (AET), Humana (HUM), and about 180 other companies will still be around selling health insurance.

(They all would be dead if the plan had been designed as the "single payer system" that some advocate. The single payer would be the government.)

But change is coming for those companies and their customers.

Fact 2: Even If You Get Sick, You Can Keep Your Insurance

If you can't get "affordable" insurance now, you can under this plan (although the proposals don't hazard a guess on the price of "affordable.")

The bill requires companies to offer a basic lowest-cost option, with minimum services defined by the government.

If you get sick, or have some health condition that needs treatment, the reform bill prevents insurers from rejecting your application, canceling your insurance or hiking your premiums, as they can now.

And, they can't deny you coverage for treatment of a "pre-existing condition."

The bill also prohibits lifetime or annual limits on benefits.

Fact 3: You'll Have A Choice Of Health Insurance Plans

If you need to buy health insurance for your family, or you own a small business and need to cover your employees, you'll have access to a kind of marketplace for comparison shopping, called the Health Insurance Exchange.

Your choices will include the basic, lowest-cost "affordable" plan, as well as higher-priced premium options.

And here's another bit that has enflamed town halls coast to coast: The minimum and premium choices would include a "public option," a non-profit, government-run health insurance policy competing directly for your business with private insurers.

That public option is the centerpiece of the plan, the bit that defines "affordable health care" for all and forces private insurance companies to compete. Removing it is like editing the whale out of Moby Dick.

The vitriolic reaction to this alleged "government takeover" of American health care has caused some of the bill's backers, including President Obama, to soft-pedal the idea.

There may be an effort to recast the public option as a kind of not-for-profit health "cooperative" run by its members. The President used that word in public, apparently opening a door to negotiation. Hours later, the White House was saying that his support for the public option is not weakening.

Whatever. The bill will require private companies to offer that basic "affordable" plan as one of their options.

And, it authorizes the government to define the "essential benefits" plan that must be offered by any insurance provider, public or private. It will limit annual out-of-pocket costs, too, in an effort to end a major cause of personal bankruptcy.

The current House plan sets those limits at $5,000 for an individual and $10,000 for a family.
No positions in stocks mentioned.
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