Pure Security Insurance, LLC
Medicare*Health*Life*Dental* & More
In March 2010, Congress passed and the President signed a new health care
reform package into law.  We understand you may have questions about the new
health care reform law, and how it may affect you.

That's why we've put together this information.  We hope it will answer some of your
basic questions about the new law, what to expect, and which changes may affect
you and your family.

The health care reform law is thousands of pages, with hundreds of provisions that
insurers will implement over the next several years.  
There were no immediate
changes when the new law was enacted in March 2010.

It's important to keep a few things in mind.  Many of the law's provisions are general
in nature.  Legislative and regulatory bodies will pass additional laws and issue
rules, regulations, and guidance that explain how health plans must comply.  Not all
of the rules and regulations have been released, so it's difficult to understand the
full impact of health care reform on any member's specific health coverage.  In the
meantime, we can share what we do know.
Here is when some of the health care reform law's provisions take effect.  
Remember, some details of the law are likely to change.

2010, Immediately:
  • The U.S. Department of Health and Human Services (HHS) will establish a
    process for federal review of rate increases.
2010, July:
  • An Internet portal will be created for consumers and small businesses to shop
    for health insurance.
2010, September
  • Health plans may not impose lifetime limits on the dollar value of essential
  • Annual dollar-value limits on benefits are restricted.  (Does not apply to
    "grandfathered" individual plans.)
  • Insurers may not rescind (void) health insurance policies, except in cases of
    fraud or intentional misrepresentation.
  • Adult children who are currently on their parents' policies and unable to get
    insurance through their jobs may stay on their parents' policies until age 26,
    regardless of their marital status.
  • Plans may no longer impose pre-existing condition exclusions on children
    under 19. (Does not apply to "grand fathered" individual plans.)
  • New policies must cover the full cost of preventative care. (Does not apply to
    "grandfathered" individual plans.)
  • Health savings accounts and flexible spending accounts may no longer be
    used for over-the-counter purchases unless those purchases have been
    prescribed by a doctor.
  • Insurers must spend 80 percent of individual health insurance premiums on
    medical services or provide rebate payments to enrollees.
  • A national, voluntary insurance program is established for purchasing long-
    term care services (CLASS-Community Living Assistance Services and
  • A new fee is imposed on health insurance companies to fund comparative
    effectiveness research (research to determine the most effective regimens,
    drugs, supplies, and therapies for various diseases and conditions): $1 per
    participant through 2013; $2 per participant through 2019.
  • Contributions to flexible spending accounts are limited to $2,500 per year.
  • Medicare payroll tax increases by 0.9 percent for individuals who make more
    than $200,000 and couples that make more than $250,000.
  • A new 3.8 percent tax will be added on income from interest, dividends,
    annuities, royalties, and rents for those at the same income threshold.
  • Health insurers must accept every individual who applies for coverage.
  • Health plans can no longer impose pre-existing condition exclusions for any
    person of any age.  (Does not apply to "grandfathered" individual plans.)
  • No annual limits on health insurance benefits.  (Does not apply to
    "grandfathered" individual plans.)
  • State health insurance exchanges introduced for individuals to buy insurance.
  • Rating restrictions go into effect: insurance companies cannot charge women
    more than men, old people more than three times what young people pay, or
    smokers more than 1.5 times more than what non smokers pay.
  • Essential benefit plan is created, which mandates the level of benefits that
    must be included in individual health insurance plans.  (Does not apply to
    "grandfathered" individual plans.)
  • A temporary reinsurance program is established in the individual market and
    funded by individual and group health plans assessments ($25 billion in 2014-
  • Families and individuals between 133 and 400 percent of the Federal Poverty
    Level get subsidies-on a sliding scale-to purchase insurance.
  • Medicaid program is expanded to cover everyone under 65 with an income
    less than 133 percent of the Federal Poverty Level.
  • A non-deductible premium tax is imposed on insurers ($8 billion in 2014,
    rising to $14.3 billion in 2018, and increasing proportional to overall premium
    growth after that).
  • States can form health choice compacts to allow insurers to sell individual
    policies in any state participating in the compact.
For frequently asked questions about the Health Reform check out the FAQ page.