After Major Health Insurance Reform Vote Over The Weekend, Menendez Touts Immediate Benefits Of Bill

After Major Health Insurance Reform Vote Over The Weekend, Menendez Touts Immediate Benefits Of Bill

Among immediate benefits: Coverage for pre-existing conditions; increased Rx drug coverage for 227,000 NJ seniors; eliminating insurance coverage limits; tax credit to keep insurance affordable for 107,000 NJ small businesses

Hoboken - Late on Saturday, health insurance reform cleared a major hurdle in the U.S. Senate, as the Senate voted to begin the amendment process on the bill. U.S. Senator Robert Menendez (D-NJ), a member of the crucial Finance Committee, voted in favor of beginning the debate. Today he spoke at Hoboken University Medical Center about the prospects for the legislation and about the benefits of the bill that will become available to families shortly after reform is enacted into law.Included in the benefits of the bill that would available quickly are a new program to ensure that those with pre-existing conditions will have coverage; an elimination of half of the prescription drug cost "donut hole" for seniors, which could benefit 227,000 New Jersey seniors; a prohibition of annual and life time limits on insurance coverage; a prohibition of insurance companies from dropping existing coverage because of legitimate claims; free preventive and wellness benefits, such as colonoscopies for seniors; and allowing young adults to stay on family insurance plans until the age of 26.

"Saturday's vote was a major milestone as we try to deliver the protections that health insurance reform will bring, but it won't be the last," said Senator Menendez. "There will be more ups and downs, highs and lows - sometimes on a daily basis - throughout the rest of this process, as there have been up to this point. But the bottom line is that sometime early next year, we will stand with President Obama as he signs a landmark health insurance reform bill into law, and in doing so, we'll be standing with families all across this state and country who no longer will have a constant, day-to-day worry about a tug-of-war with their insurance company.

"People in this state and across the country have heard plenty of fabrication and fear about what health insurance reform would mean. But I want them to know the facts. I want them to know that there in much this bill that would be available within months and would bring them health insurance security and relief from skyrocketing costs. Coverage for pre-existing conditions, protection against insurance companies dropping your coverage, an elimination of insurance coverage limits, prescription drug coverage for seniors - these and other crucial reforms will go into effect quickly, and families can stay healthier and more prosperous because of them."


Proposals implemented in 2010 and 2011 will produce real benefits for:

· Families: The 8.7 million residents of New Jersey will benefit as reform:

    • Ensures consumer protections in the insurance market. Insurance companies will no longer be able to place lifetime limits on the coverage they provide, use of annual limits will be restricted, and they will not be able to arbitrarily drop coverage.
    • Creates immediate options for people who can't get insurance today. Reform will establish a high-risk pool to enable people who cannot get insurance today to find an affordable health plan.
    • Ensures free preventive services. 41 percent of New Jersey residents have not had a colorectal cancer screening, and 22 percent of women over 50 have not had a mammogram in the past two years.2 Health insurance reform will ensure that people can access preventive services for free through their health plans. It will also invest in a prevention and public health fund to encourage prevention and wellness programs.
    • Supports health coverage for early retirees. An estimated 119,000 people from New Jersey have early retiree coverage through their former employers, but early retiree coverage has eroded over time.3 A reinsurance program would stabilize early retiree coverage and provide premium relief to both early retirees and the workers in the firms that provide their health benefits. This could save families up to $1,200 on premiums.

· Seniors: New Jersey's 1.3 million Medicare beneficiaries4 will benefit as reform:

    • Lowers premiums by reducing Medicare's overpayments to private plans. All Medicare beneficiaries pay the price of excessive overpayments through higher premiums - even the 89 percent of seniors in New Jersey who are not enrolled in a Medicare Advantage plan.5 A typical couple in traditional Medicare will pay nearly $90 in additional Medicare premiums next year to subsidize these private plans.6 Health insurance reform clamps down on these excessive payments.
    • Reduces prescription drug spending. Roughly 227,000 Medicare beneficiaries in New Jersey hit the "doughnut hole," or gap in Medicare Part D drug coverage that can cost some seniors an average of $4,080 per year.7 Reform legislation will provide a 50 percent discount for brand-name drugs in this coverage gap.
    • Covers free preventive services. Currently, seniors in Medicare must pay part of the cost of many preventive services on their own. For a colonoscopy that costs $849, this means that a senior must pay $1978 - a price that can be prohibitively expensive. Under reform, a senior will not pay anything for that colonoscopy, or for any other recommended preventive service. A senior will also get free annual wellness visits to his or her provider, with a personalized prevention plan to remain in good health.

· Small businesses: While small businesses make up 80 percent of New Jersey's businesses, only 60 percent of them offered health coverage benefits in 2008.9 107,000 small businesses in New Jersey could be helped by a small businesses tax credit proposal that makes premiums more affordable.10 And these small businesses would be exempt from any employer responsibility provisions.

· States: State budgets will be relieved from rising health care costs as reform:

    • Reduces state employee premiums. Coverage would immediately be expanded to the uninsured, decreasing the amount of uncompensated care costs that gets shifted to the premiums of state employees. For states that provide early retiree health benefits to their state employees, a reinsurance program would provide premium relief of up to $1,200 per family policy per year for all employees.
    • Reduces uncompensated care. Right now, providers in New Jersey lose $1.1 billion in uncompensated care each year,11 which states subsidize at least in part. Instead, under reform, uncompensated care would begin to be reduced immediately as more uninsured people gain coverage.

2Behavioral Risk Factor Surveillance System Survey Data. Atlanta, Georgia: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, 2007.
3 Kaiser Family Foundation. 2009 Employer Health Benefits Survey.
4Kaiser State Health Facts.
5 Kaiser State Health Facts.
6 Rick Foster, Office of the Actuary, Centers for Medicare and Medicaid Services. Letter to Congressman Stark, June 25, 2009.
7 Office of the Actuary. Centers for Medicare and Medicaid Services.
8 Centers for Medicare and Medicaid Services.
9 Center for Financing, Access and Cost Trends, AHRQ, Medical Expenditure Panel Survey - Insurance Component, 2008, Table II.A.2.
10 Center for Financing, Access and Cost Trends, AHRQ, Medical Expenditure Panel Survey - Insurance Component, 2008.
11 Hospital uncompensated care cost is estimated using a GAO model and the Hospital Cost Reports. Total uncompensated care is computed as hospital uncompensated care divided by 63% (Hadley and Holahan's study on "The Cost of Care for the Uninsured" for Kaiser in 2004 found that hospitals account for 63% of total uncompensated care). Data expressed in 2009 dollars using Centers for Medicare and Medicaid Services, "National Health Expenditure Data."

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