First I want to welcome so many of the nice people I met at the recent Folsom Chamber Biz-Expo. In the weeks to come I'll be mentioning some of their products and services to the readers of The Tattler, in my quest to have people to "buy" local "talent" and patronize local merchants.
Second, because I'm called every hour by someone asking how the new healthcare law will affect them, I've put together a short FAQ that I hope will answer your questions as well.
Finally, I want to do a bit of housekeeping and clear up some things. I've been besieged with calls and emails asking how I feel about the new legislation and whether I would back a repeal effort that many other insurance agents are talking about.
Healthcare reform is now the law of the land. I am in favor of it... and am probably the only insurance agent on the planet who is. I've said why over and over and over the past couple of years so I won't go into it again... because if you disagree with me I know I won't convince you.
People ask if it will put me out of a job. I answer "I hope so!" As I've said in this electronic fish-wrap, I much prefer to sell life, disability, long-term care, and annuity.
Some folks are saying that they favor the so called "repeal" effort by (conservative) Republicans and want me to join them (I'm registered as an "independent" which in CA is called "decline to state.")
I won't join. This is not the best law we could have passed, but it's better than what we have now. It's just that simple.
I have many, many extremely bright conservative friends, whose opinions I value. However, I think conservatives are just wasting their time in trying to repeal the new law. They are better advised to win some elections with their own candidates.
I've seen a repeal movement before. It's what the conservatives yelled about in 1963 after the passage of civil rights AND Medicare. They put up the extremest Barry Goldwater for president in 1964 on a "states rights" platform... and he got obliterated by President Lyndon Johnson.
It takes a lot of planets to align in order to beat an incumbent president. You have to have an economic issue or a huge foreign policy issue, coupled with an incredibly weak incumbent AND an incredibly likable and media-savvy challenger.
How about a quick history lesson?
Ford vs. Carter (1976): Watergate fatigue and bumble-brain incumbent vs. clean-cut "I won't lie to you" plain-speaking Southern "outsider" with a great civil rights record.
Carter vs. Reagan (1980): Gasoline lines and Iran hostage vs. the "great communicator." No contest.
Bush vs. Clinton (1992): "Read my lips," huge recession, vs. young, good-looking, well-spoken candidate who understood "It's the economy, stupid."
So tell me what the conservatives have going for them? The recession is slowing and we will be seeing an upswing in the biz cycle. Health reform is going to recede as an issue. Most importantly, conservatives don't have anyone on the bench (a March Madness b-ball term) that captivates the imagination of the electorate.
That does not mean someone like a Clinton or Obama won't emerge out of the woodwork, but if he or she does, they WON'T be a Goldwater conservative... they will be far more moderate and liberal than the right-wing of the Republican party would ever approve.
As I see it, the conservatives who are calling for repeal (many so-called "tea baggers") are destined to remain the "also-rans" of history... forever. They can make a lot of noise, I grant that. But they can't make public policy... because they don't "have" the public.
No one except a handful (relative to the entire electorate) in this country wants to go back to "Alabama of 1958." With the boomers like me passing the political baton off to an ascending young, multicultural electorate, show me where the conservative Republican demographics are? What public policies do they have that will get people to vote for them? National carry-concealed gun laws? I really don't think so.
The only hope for arch-conservative Republicans is for things to get "bad" and then get "worse" because if that happens maybe they can convincingly say "We were the party of 'no' and we told you so" and they can get a negative vote, similar to how Carter won.
I'm not saying it won't happen, but even in bad times, often the devil the voters know is more attractive than some pistol-packing arch-conservative preaching "Reload... lets roll back civil rights, healthcare, end Social Security, and outlaw abortion" as his or her platform.
As for the congress, most districts in the country are so gerrymandered that getting a new congress is rather difficult. However it can be done if you have something to offer besides "no." If Republicans had half a brain they woud hire Newt and put together a new "Contract For America"... but my guess is that most of what would be in that contract would opposed by the tea-baggers of the Republican right-wing.
Pray for rain. That's about the best advice I can give arch-conservative Republicans. Either that... or "get real" and "wake up" and realize that no one is following them back to the past no matter how often they rally their tea-baggers in the desert and wave Glock handguns in the air and spit on their opponents and yell racial slurs. That boat has sailed... and good riddance.
The President made the sale. Whether he can make the next one and the one after that is anyone's guess. But he got a lot more and a lot further than most conservatives ever expected... in their worst nightmare.
You can speculate on political motives or perceptions or political demographics or polls with regard to the next election. If you have ever worked for a candidate at the local/district level you will know that it is much harder to give a speech saying "I stopped something from happening" AND get people excited about you, then when you can come to them and say "I got you affordable health insurance." When it comes to war and direct pocket-book issues, most polls and traditional "political wisdom" are worthless.
You and I know that every candidate up for election wants to go back to the district and say "I did my job and you will be better for it because you will no longer ever have to worry about not being able to afford medical care." No candidate wants to read a long speech about how he had to vote against it because of section 7, paragraph 6, line 12 which authorized medical payments to psychic palm readers or something as mundane.
If conservaties really believe that they can derail the reform train because of so-called "political realities" they need to re-think that. All politics are local. You should walk around your own block and ask people if they want to see the current system stay in place, instead of something (anything) new... even if it will cost a few dollars more in taxes (mostly on the wealthy)... and I think you will be surprised at what you hear. You can bet that Limbaugh and Beck and Palin haven't done that.
In every couple of generations an issue comes to a head that transcends biz-as-usual politics. The last one I remember was the voting rights act of 1964. I think these are historic times. You have a choice on which side of history you want to be on. I know which side most agents are on. I know I waste my breath here telling them that it is the wrong side... but it's true.
We are going to start the process of socializing medicine... for the simple reason that privatization of it is no longer financially viable... except for the very wealthy. We are going to join the rest of the developed world in having a health care finance and delivery system paid in part by the common fund. I know conservatives hate that with a passion. But it is going to happen... so maybe they want to start thinking about the future and not spend so much time thinking how they can perpetuate the past.
You see that black guy sitting in the restaurant next to you? Do you see that Hispanic guy walking to the voting booth? Do you see those kids going to multi-cultural schools? Do you see those older people with their Medicare cards? Do you see that man opening his unemployment check? Do you see that woman deposit her social security benefit? Do you see the guy in a wheelchair holding on to his disability check? Do you see the publicly financed interstate highway? Do you see the space shuttle on TV? Do you see the seat-belts in that car? All of these were opposed in their day... by conservatives like Mr. Limbaugh, Mr. Beck, etc... and were proposed by and fought for and passed by people like you and me. We won, conservatives lost. Elections matter. Healthcare (for all) is now a right, not a privilege.
That's change you can believe in.
If that change upsets you, as I'm sure it does a few of you, then get behind Mr. Limbaugh and Mr. Beck and march behind a banner that says "Change we can prevent." But before you do, look at the conservative's won-loss record over the last fifty years... vs. those who look to the future and not backwards to the past.
-Al
The following is a look at the impact of the entire package, which would extend insurance coverage to 32 million additional Americans by 2019, but also have an effect on almost every citizen.
Here's where things stand and how you might be affected:
Q: I don't have health insurance. Would I have to get it, and what happens if I don't?
A: Under the legislation, most Americans would have to have insurance by 2014 or pay a penalty. The penalty would start at $95, or up to 1 percent of income, whichever is greater, and rise to $695, or 2.5 percent of income, by 2016. This is an individual limit; families have a limit of $2,085. Some people would be exempted from the insurance requirement, called an individual mandate, because of financial hardship or religious beliefs or if they are American Indians, for example.
Q: I want health insurance, but I can't afford it. What do I do?
A: Depending on your income, you might be eligible for Medicaid, the state-federal program for the poor and disabled, which would be expanded sharply beginning in 2014. Low-income adults, including those without children, would be eligible, as long as their incomes didn't exceed 133 percent of the federal poverty level, or $14,404 for individuals and $29,326 for a family of four, according to current poverty guidelines.
Q: What if I make too much for Medicaid but still can't afford coverage?
A: You might be eligible for government subsidies to help you pay for private insurance that would be sold in the new state-based insurance marketplaces, called exchanges, slated to begin operation in 2014.
Premium subsidies would be available for individuals and families with incomes between 133 percent and 400 percent of the poverty level, or $14,404 to $43,320 for individuals and $29,326 to $88,200 for a family of four.
The subsidies would be on a sliding scale. For example, a family of four earning 150 percent of the poverty level, or $33,075 a year, would have to pay 4 percent of its income, or $1,323, on premiums. A family with income of 400 percent of the poverty level would have to pay 9.5 percent, or $8,379.
In addition, if your income is below 400 percent of the poverty level, your out-of-pocket health expenses would be limited.
Q: How would the legislation affect the kind of insurance I could buy? Would it make it easier for me to get coverage, even if I have health problems?
A: If you have a medical condition, the bill would make it easier for you to get coverage; insurers would be barred from rejecting applicants based on health status once the exchanges are operating in 2014.
In the meantime, the bill would create a temporary high-risk insurance pool for people with medical problems who have been rejected by insurers and have been uninsured at least six months. That would occur this year.
And starting later this year, insurers could no longer exclude coverage for specific medical problems for children with pre-existing conditions, nor could they any longer set lifetime coverage limits for adults and kids.
In 2014, annual limits on coverage would be banned.
New policies sold on the exchanges would be required to cover a range of benefits, including hospitalizations, doctor visits, prescription drugs, maternity care and certain preventive tests.
Q: How would the legislation affect young adults?/
A: If you're an unmarried adult younger than 26, you could stay on your parent's insurance coverage as long as you are not offered health coverage at work.
In addition, people in their 20s would be given the option of buying a "catastrophic" plan that would have lower premiums. The coverage would largely only kick in after the individual had $6,000 in out of pocket expenses.
Q: I own a small business. Would I have to buy insurance for my workers? What help could I get?
A: It depends on the size of your firm. Companies with fewer than 50 workers wouldn't face any penalties if they didn't offer insurance.
Companies could get tax credits to help buy insurance if they have 25 or fewer employees and a workforce with an average wage of up to $50,000. Tax credits of up to 35 percent of the cost of premiums would be available this year and would reach 50 percent in 2014. The full credits are for the smallest firms with low-wage workers; the subsidies shrink as companies' workforces and average wages rise.
Firms with more than 50 employees that do not offer coverage would have to pay a fee of up to $2,000 per full- time employee if any of their workers got government- subsidized insurance coverage in the exchanges. The first 30 workers would be excluded from the assessment.
Q: I'm over 65. How would the legislation affect seniors?/
A: The Medicare prescription-drug benefit would be improved substantially. This year, seniors who enter the Part D coverage gap, known as the "doughnut hole," would get $250 to help pay for their medications.
Beyond that, drug company-discounts on brand-name drugs and federal subsidies and discounts for all drugs would gradually reduce the gap, eliminating it by 2020. That means that seniors, who now pay 100 percent of their drug costs once they hit the doughnut hole, would pay 25 percent.
And, as under current law, once seniors spend a certain amount on medications, they would get "catastrophic" coverage and pay only 5 percent of the cost of their medications.
Meanwhile, government payments to Medicare Advantage, the private-plan part of Medicare, would be cut sharply starting in 2011. If you're one of the 10 million enrollees, you could lose extra benefits that many of the plans offer, such as free eyeglasses, hearing aids and gym memberships. To cushion the blow to beneficiaries, the cuts to health plans in high-cost areas of the country such as New York City and South Florida – where seniors have enjoyed the richest benefits -- would be phased in over as many as seven years.
Beginning this year, the bill would make all Medicare preventive services, such as screenings for colon, prostate and breast cancer, free to beneficiaries.
Q: How much is all this going to cost? Will it increase my taxes?
A: The bill is estimated to cost $940 billion over a decade. But because of higher taxes and fees and billions of dollars in Medicare payment cuts to providers, the bill would narrow the federal budget deficit by $138 billion over 10 years, according to the Congressional Budget Office.
If you have a high income, you face higher taxes. Starting in 2013, individuals would pay a higher Medicare payroll tax of 2.35 percent on earnings of more than $200,000 a year and couples earning more than $250,000, up from the current 1.45 percent. In addition, you'd face an additional 3.8 percent tax on unearned income such as dividends and interest over the threshold.
Starting in 2018, the bill would also impose a 40 percent excise tax on the portion of most employer-sponsored health coverage (excluding dental and vision) that exceeds $10,200 a year for individuals and $27,500 for families.
The bill also would raise the threshold for deducting unreimbursed medical expenses from 7.5 percent of adjusted gross income to 10 percent.
The bill also would limit the amount of money you can put in a flexible spending account to pay medical expenses to $2,500 starting in 2013. Those using an indoor tanning salon will pay a 10 percent tax starting this year.
Q: What will happen to my premiums?
A: That's hard to predict and the subject of much debate. People who are sick might face lower premiums than otherwise because insurers wouldn't be permitted to charge sick people more; healthier people might pay more. Older people could still be charged more than younger people, but the gap couldn't be as large.
The bigger question is what happens to rising medical costs, which drive up premiums. Even proponents acknowledge that efforts in the legislation to control health costs, such as a new board to oversee Medicare spending, wouldn't have much of an effect for several years.
In November, a CBO report on how the legislation – which at that point had a tougher Cadillac tax – would affect premiums said big employers would see premiums stay flat or drop 3 percent compared to today's rates. It also noted that employees with small- group coverage might see their premiums stay the same. And Americans who received subsidies would see their premiums decline by up to 11 percent, according to the CBO.
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