Federal health insurance reform provisions begin to take shape in California

Lest you thought the debate over federal health insurance reform was over, in actuality it has really just begun.  With the law on the books, insurance companies, States, and the Feds are moving into implementation mode. 

Earlier this week, it was reported that some of the major insurance companies including UnitedHealthcare, Humana, Kaiser Permanente, and WellPoint agreed to implement the provision that allows adult children to stay on their parents’ health plan until age 26, a few months early.  As originally written and signed into law, students would become eligible for expanded coverage in September 2010. 

Yet, with thousands of collage-age students getting ready to graduate from college, losing coverage for the summer months suddenly became apparent.  While each health insurance company will handle the situation slightly differently, the fact remains that they will indeed continue coverage for students ahead of schedule.

In Sacramento, the Assembly Health Committee approved AB 1602, which will establish the state “exchange” or “marketplace” called the California Health Benefit Exchange, where small businesses and individuals will be able to purchase health insurance.  The bill was introduced by Assembly Speaker John Perez (D-LA) with the intention of taking affect by January 2011, three years before required by federal law.  

The other provisions contained in the bill will modify state law in an effort to conform to the federal health insurance reform. Taking effect by the end of 2010, including extending coverage for dependents until age 26, it will eliminate lifetime limits on benefits and prohibit denying children coverage due to pre-existing conditions.

And in Washington, the IRS sent more than 500,000 small business and tax-exempt groups in California a notice that they may quality for tax credits on their employees’ health insurance premiums.   Specifically, the small businesses that qualify would be eligible for a federal tax credit up to 35 percent of health insurance premiums paid beginning in 2010. 

After a year-long debate full of poisonous partisan vitriole, health insurance reform appears to be getting off to a good start.