Congressman John Tierney today praised key components of the Affordable Care Act that went into effect on January 1, 2011, including a provision that he spearheaded to require insurers to spend 80 to 85 percent of health premiums on medical care, rather than administrative costs. In addition, the newly enforced provisions will cut government overpayments to insurance companies, reduce the costs of prescription drugs for seniors and provide them with free preventive services.
"History has shown us that health insurance companies put profits and bonuses ahead of the health care of their customers. This will change because of the requirements set forth through the Affordable Care Act. I fought hard for this provision, which is a necessary step to reforming our health care system, and I am committed to ensuring that insurance companies follow the law and consumers are provided the full benefits of their health insurance premiums," Congressman Tierney told the Lynn Daily Item yesterday.
The Affordable Care Act passed by Congress in 2010 put in place comprehensive health insurance reforms to hold insurance companies accountable, strengthen Medicare, and lower health care costs. This week the following provisions went into effect:
·Insurance companies will be required to spend premium dollars primarily on health care, rather than on insurance companies' administrative costs and executive salaries. Starting in 2011, at least 85% of all premium dollars for large employer plans and at least 80% of the premium collected by insurance companies for individual and small employer plans, must be spent on health care services and quality improvement.
·The law provides seniors who receive benefits through Original Medicare with stronger preventive care benefits by providing free annual wellness check-ups who receive benefits through Original Medicare. Seniors who are enrolled in Medicare Advantage programs will also no longer have to pay co-payments for annual wellness exam or related medical tests.
·Medicare will also begin to cover certain preventative services without charging the Part B coinsurance or deductible.
·The law will close the so-called Medicare prescription drug "donut hole" over time. For Medicare beneficiaries reaching the coverage gap in 2011, prescription coverage will be available with a 50% discount on brand name drugs.
During the health care debate last year, Congressman Tierney took a leading role in the effort to ensure that insurance companies place their customers' health ahead of their inflated salaries, bonuses and profits. Before the final bill was passed, Congressman Tierney had successfully included a provision that will force insurance companies to take great strides in reforming their spending habits and put the health of their customers first.