Breaking Down the Health Care Bill: How It Affects YOU

Change will not happen overnight. The passage of the bill is just one step towards giving the majority of Americans affordable health care. Some immediate changes include lowering costs for individuals and allowing children to stay on their parents’ plans until age 26. This means that most of us are off the hook- or so it would seem. But even if we aren’t required to deal with health care on our own yet, it’s something we should all familiarize ourselves with, because at some point down the road, we’re going to have to know what’s up.

If you ever watch Oprah, then you know who Dr. Oz is. He weighs in on what he thinks about the new health care bill here. 

The entire health care bill is a lot to digest. Irene S. Levine, Professor of Psychiatry at NYU School of Medicine and Freelance Journalist and Author, believes it is important to begin by familiarizing yourself with your own personal insurance plan.

“For those college students who have or will now have insurance, they need to understand the specifics of health care reform; carefully review the provisions of their specific insurance plan options (in terms of the coverage, premiums, deductibles and co-pays),” she suggested.

She says to start by comparing individual policies, parent policies, employer policies and university-sponsored student policies; and examining the options for choice of doctors and facilities provided by each.

Hanging on

The new health care bill allows children to remain on their parents’ health care plan until the age of 26. But until you go jumping for joy about this new policy, make sure you figure out what market your parents belong to. If your parents are self-employed, then they have to purchase their own health care, rather than receiving it through their job. Children whose parents are self-employed have to go off of their parents’ health care plan at the age of 19.

However, if your parents are a part of the group market, meaning they receive health care through their employer, then you are eligible to remain on their plan until you are 26. Sophomore Elon student Sarah Dodge is a fan of this new stipulation.

“I personally think it will help encourage people to attend graduate school because they won’t have to seek out healthcare immediately after college,” she said.

The bill does not require that adult children be full-time students, nor do they have to be financially dependent upon their parents. You can be employed and you can even live in a different state than your parents, and you’ll still be able to use their health care plan.  The only catch is that if you are offered health care from your own job, you are no longer eligible to remain on your parents’ plan.

Letting go

While it’s possible for you to stay on your parents’ health care plan until you’re 26, in many cases, you’ll probably switch over before then. Recent Elon graduates Rachel Cieri and Alexa Milan are both making the move in a few months.

“My health insurance at my job kicks in after 90 days, so at that point, I’ll go off of my parents’ plan,” Milan explained. Her parents’ plan, like many health care plans in the United States, required that she switch over to her own health care plan once she was employed.

Cieri found herself in the same situation. She will be switching over to her own plan come September.

“I’m choosing to switch over to my own health care plan (through my employer) once I become eligible, which is after 90 days of employment,” Cieri said. Like these two newly employed college grads, you too may have to make the switch once you get your own Big Girl job. So keep that in mind!

Gender crisis

The most difficult area of the health care system is the individual market.

“The costs of individual policies were especially high for young women, with the high prevalence of pregnancy in that age group,” Levine said.

Women are currently paying 1.5 times more for health care than men are. Also, 41% of women receive health care coverage from their husband. Many believe that women are discriminated against under the health care system, and this is something that may change with the passage of the health care reform bill.

Part-time jobs

Until you graduate from college and secure that awesome, stable job that you’ve always dreamed of, chances are you’ll be waiting some tables. College women typically hold part-time jobs, which places us in the small group/individual market when it comes to health care. In this market, there is little to no leverage or bargaining power, resulting in the highest prices for health care.

Levine said that in the past, employers often sidestepped offering health care benefits by hiring young people who would not stay with their company for very long. An additional problem was hopping from one part-time job to another.

“If someone had employer-sponsored health care but changed jobs one or more times, they might have periods of time when they had no insurance coverage,” Levine said.

Luckily, the individual and small group markets are the largest reforms set to occur under health care reform.

Tax on Tanning

If you hit up tanning beds to get your nice glow, you’ll want to think again. In order to help pay for the $940 billion health care bill, the Obama administration is going to start a 10% tax on those who use indoor tanning beds. This new tax is expected to generate $2.7 billion over the next ten years.

Is it ever okay not to have health care?

The answer is probably not—though the choice is ultimately yours. But before you decide to brush it off as an unnecessary item, make sure you do some research. Levine believes that young people need to take responsibility for themselves when it comes to health care.

“They need to understand the importance of assuming responsibility for their own health care and becoming their own best personal advocate,” she suggests.

College students are generally healthy and suffer from few serious illnesses. But who knows- you could get really sick or have some sort of accident. Could you imagine paying for serious surgery out of pocket? That’s probably a risk you’d want to avoid, and having health insurance allows you to do so. While health care may not always seem like a necessity, Levine believes that it is.

“Young people tend to minimize the health and financial risks of potentially catastrophic illnesses because they are so infrequent in this age cohort,” she said. “Yet the consequences can be dire to the individual and his/her family.”

Repercussions

Starting in 2014, those who choose not to purchase health care will suffer a penalty. Those who don’t have health care will have to pay $95 each year, or 1% of their income, whichever is higher. If this doesn’t seem too bad to you, then get this: starting in 2016, those who don’t purchase health care will have to pay $695 a year or 2.5% of their income, again, whichever is greater. And if you have a family by that time, the head of the household will be paying that amount for each member of the household that is not covered by health care. Basically, it would behoove you to get some coverage. Not sure where to look? Read on.

Your school’s plan: worth it or not?

Most universities offer health care coverage through the school. This website is helpful in finding out what your school’s policy is. Just type in the name of your university, and you’ll have all the information you need! Information about basic medical expense coverage, eligibility and exclusions are all available through the website specific to your institution. Most schools require that you have some sort of health care plan, whether it’s through the school or not. Make sure you familiarize yourself with your school’s policy, so you can do some research and get on the right track!

Where to look

If you’re a student in search of individual health care, the best bet is to go through your employer. You may also be able to receive some sort of group rate through your university. Chris Dinnin, Vice President of Healthcare Services at SDLC Partners, a Pittsburgh-based consulting firm, also recommends doing what people in their early twenties do best: leveraging the power of the Internet.

“Online is the best place to compare costs,” Dinnin said. “But I also suggest shopping around.”

You can get a quote here in a few simple steps.

Dinnin said that due at least in part to healthcare reform, insurers are targeting younger consumers, so it is important to look around and make sure you are getting the plan that’s right for you and most affordable.

“If you’re young, healthy and looking for affordable individual healthcare, one option is to keep the deductible as high as possible and take advantage of a health savings account and tax-free savings,” Dinnin advises.

In an effort to attract younger, more profitable members, and shift some of the responsibility for managing health to their members, health insurers are now offering high-deductible health plans that combine traditional plan insurance with high deductible.

If you aren’t down with the health care lingo, here are some translations: The deductible is what you, the insured, are paying out of your pocket. The premium is the total amount you’ll be paying for insurance coverage. A higher deductible keeps your cost lower because you’re assuming more responsibility. Generally, the higher the deductable, the lower the premium.

For example, if you are a twenty-year-old female with a $1,000 deductable, you would have a premium of $100 per month. But if your deductable was only $250, your premium would rise to about $150 per month.

Say you have to pay for surgery that costs $5000. If your deductable is $1000, you pay the $1000 and your insurance provider pays the difference, $4000.  But as a college student, you’re assuming that you’re generally healthy and won’t have to pay for much in terms of medical help.

“Unless young people have a specific chronic disease, they can assume that their out of pocket expenses will generally be low. High-deductible health plans typically cover annual physical expenses and include preventative care, and do so at a relatively affordable price,” Dinnin explained. For women that usually means regular physicals as well as gynecological exams and tests.

He also suggests combining the high deductible health plan with a health savings account, which is paid for by tax-free dollars.

“Tax-free savings covers all over the counter health-related purchases at the drug store,” Dinnin said. “You put the money into an interest-bearing account and then typically you use a debit card to pay for health-related expenses. It’s pretty straightforward.”

And while intended to be focused on healthcare specific costs, you can use it to cover anything from Band-Aids to prescription medications.

Many 18-26 year olds don’t bother worrying about health care because they think they’ll get it when they need it. But with all of the changes that are happening, it’s important to put health care on your radar.

Levine thinks that it’s great that the new law will extend care for young people whose parents have employer-sponsored or private health care plans.

“Hopefully, this will make health and mental health care more affordable for many young people who either couldn’t otherwise obtain or afford insurance on their own,” she said. “While the new legislation is imperfect, it appears to be a significant step in the right direction.”

Get more detailed information about health care reform straight from the White House here.

Sources

Chris Dinnin, Vice President of Healthcare Services at SDLC Partners

Irene Levine, Professor of Psychiatry at NYU School of Medicine and Freelance Journalist and Author

Sarah Dodge, student at Elon University

Rachel Cieri, Elon University ‘10

Alexa Milan, Elon University ‘10

http://www.collegiaterisk.com/Students/Elon/elon.html

http://www.huffingtonpost.com/dr-mehmet-oz/what-you-can-do-about-hea_b_249762.html