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Q & A

What the health insurance mandate means

Will every American be required to buy a plan? What happens if you don't? How are veterans and small-business owners affected?

December 06, 2009|By James Oliphant and Kim Geiger

Reporting from Washington — Some of readers' most frequently asked questions since the healthcare debate began in earnest this summer:

Will I be forced to buy health insurance? Will I go to jail if I don't?

The short answer is yes, you probably would be forced to buy insurance, but no, you aren't likely to be locked up if you don't, unless you're a big-time tax cheat.

Both the House and Senate bills would require Americans to have health insurance. If you don't have insurance through your job or through Medicare, Medicaid, Tricare or some other government plan, you would have to buy a plan or pay a tax penalty. Supporters of this requirement say that forcing people to have insurance -- especially young, healthy people -- will lower costs for all involved because it will allow insurance companies to spread risk across a larger group.

I'm a veteran. Will my healthcare benefits be affected?

Probably not. The White House has insisted that neither veterans nor active-duty military will be affected by the overhaul regardless of whether they receive benefits through the Department of Veterans Affairs or Tricare, the military's healthcare program. Veterans would also be exempted from the individual mandate.

I run a small business. Will I be forced to offer my employees health insurance?

It depends on the size of the business. Under the House bill, if your payroll is less than $500,000, you would be exempt. Above that, you would pay a penalty based on your payroll. Under the Senate plan, if you employ more than 50 full-time workers, you would have to offer insurance or pay an annual penalty of $750 per employee.

Will the new insurance exchanges cover abortion procedures?

Under the House bill, any insurance plan that is subsidized by the government cannot offer abortion coverage. An insurer could, conceivably, offer separate coverage in the form of a rider, but critics argue that is unlikely to happen and women are unlikely to purchase it.

According to the current Senate bill, an insurer could still offer abortion coverage but would be forced to ensure that only private funds, not federal funds, are covering the costs of the procedure. An effort is expected to alter the Senate language to match the House bill.

I have insurance through my job. Will this bill affect it?

In the short term, probably not. In the longer term, yes, in a variety of ways: Insurers in group plans will be required to offer a minimum set of benefits. They won't be allowed to rescind coverage in the event of illness or accident. They won't be able to limit the amount of benefits to be paid to you over your lifetime. And they could be restricted in how much of your premiums they can use for marketing and other non-insurance-related activities.

Also, if the Senate's proposed tax on high-end or "Cadillac" insurance plans goes into effect, you could end up paying a greater share of the cost of the plans or they could be eliminated altogether.

Critics maintain that the healthcare bills will do nothing to control costs for employer-based health insurance and that premiums will continue to rise dramatically.

joliphant@latimes.com

kim.geiger@latimes.com

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