Impact Of Health Care Legislation Hr 3962 On The Outsourcing Industry

President Barack Obama had a hard won victory on Saturday night (the 7-8th day of November 2009) when the landmark health care reform legislation (HR 3962) was passed with 220-215 votes. Now if everything goes the Obama way, then by the end of the year ’09 “Affordable Health Care for America Act” would apply as a law impacting almost fifty million US lives. But what does this Act actually imply? How does it stand to impact an average US life? How does the Act affect the outsourcing industry at large? Through my article below I endeavor to answer these and many more questions.
Ab-initio we will refresh the fundamentals of federalism, stating the Roles, Duties, Nature, Scope and Restrictions on the government in a written federal constitution. Next we proceed to see whether the above attempt by the federal government to accede healthcare legislation is ultra-vires the powers granted by the US Constitution.

What is Federalism?

According to the traditional classification followed by the political scientists, constitutions are either unitary or federal. In a unitary constitution, the powers of the government are centralized in one government viz., the Central Government. In the federal constitution, on the contrary, there is a division of power between the federal and the state governments in a way that they are both inter-dependent and independent at the same time.
As we all know that Constitutions are organic documents which operate as fundamental law. The governments and their organs owe their origin to the constitution, derive their authority from the constitution and discharge their responsibilities within the framework of the constitution. The judiciary has the power to declare a law unconstitutional if the law is found to have contravened any provision of the constitution. The American Constitution is the oldest and a well praised example of federalism.

What are the powers granted by the US Constitution to the State Government?

Powers reserved for State Governments are:
• Establishing local governments
• Issuing licenses (driver, hunting, marriage, etc.)
• Regulating intrastate commerce
• Conducting elections
• Ratifying amendments to the U.S. Constitution
• Providing for public health and safety
• Exercising powers which are neither delegated to the Federal Government nor were prohibited from the States by the Federal Constitution (residuary powers)
• Framing other domestic law (for example, setting legal drinking and smoking ages etc.)

What are the powers granted by the US Constitution to the Federal Government?

Under the Constitution, powers reserved for the Federal Government are:
• Printing of money
• Declaration of war
• Establishing the armed forces
• Entering into treaties with foreign governments
• Regulating commerce domestically and internationally
• Establishing post offices and issuing postage
• Making laws necessary to enforce the Constitution

What are the powers shared by Federal and State Government?

Under the Constitution, the shared, or “concurrent” powers are:
• Setting up courts
• Creating and collecting taxes
• Building highways
• Borrowing money
• Making and enforcing laws
• Chartering banks and corporations
• Spending money for the betterment of the general welfare
• Acquiring private property with appropriate compensation

What is the HR 3962 Act ?

The HR 3962 Act conceptualizes a new, voluntary, public, long-term care insurance program to help purchase services and support for people who have functional limitations. The Act endeavors to form a new national program to provide affordable coverage for those who can’t get health insurance today because of pre-existing conditions. Under this, the insurance companies must spend 85 cents out of every premium dollar on medical services, thereby fostering the expansion of Medicaid and improving the Medicare. Under this, the young adults, till the age 26, are covered within their parents’ policies.

The Obama administration intends to attain this by creating mandates. As a self-sustaining public insurance option (that is financed not by tax dollars but by insurance premiums), this provides an alternative to and competes with private health insurance companies, on a level playing field. Additionally, the Act intends to eliminate the antitrust exemption for health insurers and medical malpractice insurers thereby fostering competition thus targeting the existing monopolies in the health insurance market. It aims to establish a new mandatory essential benefits package that shall become the minimum quality standard for employer plans, with the passage of time. The package places a cap for annual out-of-pocket spending, at a maximum of $5,000 per individual and $10,000 per family to prevent bankruptcies from medical expenses.

This Act requires the employers to either provide insurance to their employees or contribute to the cost of their coverage through the public plan/exchange, though the small businesses are exempted from this requirement.

Arguments regarding Constitutionality of HR 3962

The legal fraternity is divided between two schools of thought about the constitutionality of the Act. First school believes that the Act is unconstitutional and places reliance on Articles I §8 and V of the US constitution and on Tenth Amendment. They claim that their argument is supported by the celebrated case of MARBURY v. MADISON, 5 U.S. 137 (1803) and some federalist opinions. The second school of thought places reliance on Article I §8 and the celebrated case of McCulloh v. Maryland, 4 Wheaton 316 (1819); Steward Machine Co. v. Davis, 301 U.S. 548 (1937); United States v. Butler, 297 U.S. 1 (1936) and some federalist opinions. An in-toto analysis of these school of thoughts would conclude that the true interpretation of the word ‘general welfare’ in Article I §8 of the U.S. Constitution can only determine the constitutionality of an Act like HR 3962. Till date the court opinions have been more inclined towards Hamilton (Federalist 33, 83 etc.) and Story rather than Madison (Federalist 41, 45 etc.).
Simply put, when the government mandates welfare as a quid-pro-quo for premiums collected, such welfare translates to nothing but a tax liability for the country men. Such an attempt by the government to regulate insurance sector by masquerading as an industry player is inspired from socialism. I personally feel that socialism is a Marxian concept and may not go well in an economy with capitalist foundations. The good thing is that people all over the world should buy insurance; this however turns bad when the government forces people to do so.

What are the implications of HR 3962 on the Outsourcing industry?

The object clause to the Act states that it is meant to provide affordable, quality health care for all Americans and reduce the growth in health care spending.

In reality, the act is a victim of haste. Ideally if the intention of the Obama administration and the object clause of the Act were actually in-sync then the administration should have awaited a confirmed indication of the end-of-recession. The administration should have first looked at strengthening the fundamentals of the economy, by:
ü better regulating the existing insurance sector,
ü improving the US agrarian culture and making the country self sufficient regards its food requirements,
ü checking the cost-of-living index and
ü creating more jobs in the private sector.
But if the intention is to make more and more Americans dependant on Federal Government for basic requirements, then the attempt is bang on.

Impact on the outsourcing industry:

Prima-facie it may seem complex but there are clear indications for the outsourcing industry to benefit once the HR 3962 is implemented. The benefit roots from the fact that the employees will become expensive for the employers post this Act’s applicability. Now given the very competitive market scenarios, thin profit margin and the inability of the employer to transfer this increased cost to the end consumer, the employer is forced to search for the less costly alternatives. It is needless to say here that the Act magnifies the already existing labor arbitrage opportunities internationally. To appreciate the existing labor arbitrage opportunities you can refer to my older blog post.

By: mishra_jagriti

Anthem Blue Cross Vs Blue Shield – A Competitive Analysis

Anthem Blue Cross is the health care company the people of California has trusted for several decades to protect their health at affordable rates. In fact, Anthem Blue Cross covers 8.3 million Californians – more than any other carrier in the state – and has today become a household name in California.

Anthem Blue Cross is a dynamic company constantly striving to create innovative health coverage solutions that are accessible as well as affordable to all Californians. Anthem Blue Cross provides customers a multiplicity of choice and flexibility in meeting their individual health care needs.

Unique offerings are available in the individual, small and large group, senior and similar segments and they include a full range of integrated medical and specialty products, such as dental, vision, life and disability coverage.

It has to be noted that Anthem Blue Cross has won many recognitions they can be proud of. Anthem Blue Cross HMO/POS has earned an Excellent Accreditation status from the National Committee for Quality Assurance (NCQA). Anthem Blue Cross PPO is the first and continues to be the only PPO in California to have earned a Full Accreditation from the NCQA5.

Two years back, they launched the Zagat Survey online tool, which will allow consumers to share their medical experiences with one another. The survey and results will be available free of charge to members via their health plan’s web site.

They go beyond covering health care needs and take extraordinary pain to educate people how to prevent illness and lead healthy lives. To accomplish this goal, they provide members with health-related resources and information. They recommend preventive care by asking members to take precautionary screening, undergo immunizations and participate in counseling programs for preventing major illnesses.

Blue Shield of California

To those who may not be aware, Blue Shield Ca is an independent member of the Blue Shield Association and more than that, they are a not-for-profit health care organization committed to providing Californians access to high-quality health care at an affordable price.

As a not-for-profit health care institution, Blue Shield is guided by certain ethical values, which enables them to be a catalyst for innovation and constant improvement.

Blue Shield of California supports and celebrates the different life paths of their clients. Their service helps many people in the Golden State of California live robust, healthy lives free from serious illnesses.

Blue Shield has a long enviable history of providing access to quality health care for millions of Californians with diverse lifestyles, different health conditions and different medical care needs. As a not-for-profit organization, their endeavor is more about preserving the health of their members than about dollars.

Anthem Blue Cross and Blue Shield

Companies like Anthem Blue Cross and Blue Shield must stay competitive especially with their continuing changes in the health care system. By offering better coverage, they can still compete not only with each other but also with what the government will be offering. There are also controversial issues like abortion and Medicare that the government will have to deal with before anything can be passed.

Companies like Anthem Blue Cross and Blue Shield can take advantage of whatever market the government leaves behind. For instance, large corporations like Anthem Blue Cross and Blue Shield, can choose to cover abortion costs whatever the government chooses to do.

By: Muthu

When Do You Need Medigap

Given how spotty Medicare coverage is for those retired over the age of 65 or for those who are disabled and receiving Medicare benefits, there are policies called Medigap coverage that help fill in the gaps left by Medicare. Medigap policies or Medicare Supplement Policies are standardized by the Center for Medicare and Medicaid Services, but sold and administered by private health care companies. Because those who have Medicare coverage are usually retired persons with fixed income, the cost of having to purchase and maintain a Medigap policy can be cost prohibitive. Prices for policies vary and depend on how extensive the list of services is signed up for. Depending on the assets held by the insured, some may qualify for financial assistance through Medicaid or other services, while some will not.

Medicare beneficiaries can fill in Medicare’s coverage gaps in a number of different ways, including

~Government Programs

~Group Retirement Policies

~Non-Standardized Individual Medigap Policies

~Standardized Individual Medigap Policies

Medicare beneficiaries who are also eligible for Medicaid do not need Medigap insurance since Medicaid will cover the cost of their health care expenses. People who do not qualify for Medicaid but are within 100% of the federal poverty level are eligible for coverage under a program known as the Qualified Medicare Beneficiary Program (QMB). QMB program benefits include:

~Payment of Medicare premiums.

~Payment of Medicare annual deductibles.

~Payment of Medicare coinsurance amounts.

Thus individuals who qualify for the QMB program generally also do not need, and should not pay for, Medigap coverage. Individuals who do not qualify for QMB because of excess income may qualify for the Specified Low-Income Medicare Beneficiary Program (SLMB) or Qualified Individual Program (QI). People who have incomes within 120% – 135% of the federal poverty level are eligible for SLMB or QI coverage. However, SLMB and QI only pay for the Medicare Part B monthly premium. Therefore, SLMB and QI individuals may still want to purchase Medigap insurance if they can afford to do so.

Some employers offer health insurance coverage to their retirees. Retirees who are covered by such group plans may not need to purchase an individual policy. While a retiree may choose to switch to an individual plan, this may not be a good choice because group retiree plans usually do not cost anything to the individual and the group coverage is often as good or better than most individual Medigap policies. Thus the individual should compare his company’s policy costs and coverage with the ten Medigap policies. The retiree should also consider the stability of his company. If it is conceivable that the company will falter, that his costs will rise, or that coverage will diminish, the individual may wish to purchase an independent policy. Remember, however, that if a new policy is purchased the old policy must be dropped.

Most Medicare beneficiaries are not eligible for Medicaid or QMB, however, and may want to obtain Medigap insurance. Approximately two-thirds purchase Medigap policies. As of July 31, 1992, Medigap policies were standardized throughout the United States. This mandatory standardization was a result of legislation passed by Congress through the Omnibus Budget Reconciliation Act of 1990. There are ten specific benefit plans which federal law permits to be sold as Medigap policies. Two new plans were added in 2006. States may allow all or some of these plans to be marketed. Insurance companies may sell all or some of the plans which the individual state allows them to market. However, there is a basic benefit package, known as the “core benefit” plan, which must be allowed in all states and which must be offered by any company which sells Medigap insurance.

Although individual Medigap policies have been standardized since 1992, some seniors are still covered by previously issued non-standardized plans. These policies are no longer available for purchase. However, individuals may continue to keep their old policies and many people have chosen to do so. Individuals covered by an old policy should consider changing to a new “standardized” plan, and should compare the benefits and costs of each of the policies. Then an informed decision can be made. An individual who purchases a new standardized policy can only have one Medigap policy and must therefore drop the old, non-standardized plan. This protects people from the unnecessary costs of duplicate coverage.

What actual Medicare coverage is can be confusing, and things are always subject to change. There are books given by the government as well as the Medigap policy issuer that help explain what is covered and what is not. There are also some great books published that work on behave of the insured and provide wonderful resources for advocacy when needed.

By: Empowering Information

Making A Nursing Home Feel Like Home

As people get older, it can become increasingly difficult to undertake personal care tasks and maintain a working home. Whilst many older people live happily and independently in their own homes, others choose to move into a nursing home because of ill health or limited mobility.

Nursing homes have the advantage of offering a sense of community as well as regular activities for residents to take part in. As a relative of someone who has moved into a nursing home, you may also be reassured to know that residential homes can also offer suitable health care and medical attention.

If a dependent relative – such as your mother, father or grandparents – is taken into a nursing home they will most likely want to take their belongings with them. The most recent survey from the Office for National Statistics reports that older women are more likely than men to live in nursing homes, since 23% of women over 85 were residents in care compared to 12% of men of the same age. These older women may enjoy decorating their room with a few prized possessions, to create a new home for themselves and feel more at ease.

Perhaps your relative would like some family photos to put on the wall, a small piece of furniture that has stayed in the family, or a few trinkets and decorative items. Just a few touches of individuality will bring any room in a nursing home to life, and make it feel like a home from home. You will understandably want to make your relative as comfortable as possible, and helping them take their treasured belongs with them is one way to do this.

You can also offer your dependant relative peace of mind by protecting their belongings financially too. Your home insurance may well cover any belongings that your dependent relative has with them in their nursing home, often up to a value of £2,500 for any one claim. Whilst accidental damage is covered, theft will only tend to be covered if there is evidence of a forcible or violent entry into the building.

So whilst a nursing home is able to care for your loved one, you are able to financially protect your loved one’s belonging. This peace of mind means that you and your relative can enjoy spending time together in their new home.

By: Josie Anderson