10 Major Changes to Health Reform in House's Reconciliation Bill

Janice Simmons, for HealthLeaders Media , March 19, 2010

Individual Mandate. Similar to the Senate bill, the new bill would penalize most Americans without insurance. The first annual penalty would be $95 and start in 2014. However, in subsequent years, the penalties in the reconciliation bill are slightly different. Those without insurance would pay the greater of two alternatives: (1) a flat fee of $695, which is down from the Senate's $750; or (2) 2.5% of their income.

Medicaid Expansion: The House reconciliation measure calls for full federal funding to all states for newly eligible Medicaid recipients. The funding would last for three years. The bill also eliminates the controversial provision—nicknamed the "Cornhusker Kickback"—that would have exempted Nebraska from paying the costs of Medicaid expansion included in the Senate bill.

Disproportionate Share Hospital Payments. The House provision lowers the reduction in federal Medicaid Disproportionate Share Hospital payments from $18.1 billion to $14.1 billion over the 10-year period. The reductions would not begin until fiscal 2014.

Fraud and Abuse. Funding for fighting fraud, waste, and abuse is increased by $250 million over the next decade. Funds to fight Medicaid fraud will be indexed based on increases in the Consumer Price Index.

Premiums Tax Credits. The reconciliation bill would provide more generous credits to low and moderate income Americans, up to 400% of the poverty level.

Physician Owner Referrals. The reconciliation bill includes a date (Dec. 31, 2010) for the prohibition of physician-owned hospitals to self-refer.

Janice Simmons is a senior editor and Washington, DC, correspondent for HealthLeaders Media Online. She can be reached at jsimmons@healthleadersmedia.com.

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