Health-care overhaul: Does it mean a government takeover of health insurance?

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Monday, October 18, 2010; 6:16 PM

The law amounts

to a government takeover of health insurance and health care.

SAYS WHO?

Some GOP politicians, including Rep. Wally Herger (Calif.), the ranking member of the Ways and Means subcommittee on health, who says the law is a "government takeover of health care" and should be repealed.

HOW TRUE IS IT?

The law does signal a sharp expansion of the federal government's involvement in health care. It requires most Americans to have insurance and imposes a raft of federal rules on insurers. It also vastly increases the number of people who will qualify for Medicaid, the federal-state program for the poor, and offers subsidies to others who can't afford private coverage. Still, it falls short of a government takeover.

Most people younger than 65 will continue to receive health insurance coverage through private employers and insurers. Medical care will be provided by private hospitals and doctors. Drug companies and device makers will continue to develop and sell their products. Prices in the private market will be determined by competition and negotiations; fees paid to doctors and hospitals by Medicare will continue to be set by the government.

Insurers will be barred from rejecting applicants with health problems and will be required to use a certain percentage of the premiums they collect on medical care - as opposed to administrative expenses or profits, for example. Premium increases will get more scrutiny but won't be directly regulated by the federal government.

The law doesn't create government-run insurance plans. But states (or the federal government) will run "exchanges" - marketplaces - where private insurers will sell insurance to individuals and small businesses.

The law also promotes the creation of consumer co-op plans, which would be member-run, nonprofit insurers.

The government's share of the nation's health-care tab will continue to grow as more people sign up for Medicaid and the baby-boom generation hits Medicare age. By 2012, Medicare actuaries estimate, the government will be paying for slightly more than half the nation's health-care bill, up from 48 percent in 2008.

- Julie Appleby


© 2010 The Washington Post Company

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