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Published: April, 2017; Vol 13, Num 11

 

A Guide to Understanding Health Care Terminology

The ongoing efforts to change or repeal the Affordable Care Act (ACA), also known as “Obamacare,” could lead to significant impacts on health care for LIUNA’s health and welfare funds, signatory contractors and members and their dependents. The LHSFNA will continue to monitor new or proposed legislation and share the most pertinent information for LIUNA’s audiences in our bi-weekly Health Care and Insurance News Bulletin.

Following along with health care-related articles and news can be difficult and confusing. There are a lot of terms to understand, and many of them are complex, even for those with a health care background. If you’re interested in following news and information about health care reform, here are some terms you should know.

  • Individual mandate: ACA requirement that all individuals carry health insurance or pay a penalty
  • Continuous coverage incentive: A part of the now withdrawn American Health Care Act (AHCA) that would have encouraged people to remain insured by letting insurance companies charge higher premiums if coverage lapses
  • Premium tax credits: Amount an annual or monthly insurance premium is reduced due to factors such as annual income, age or other information
  • Cost-sharing subsidies: ACA statute that lowers the amount people have to pay out-of-pocket for deductibles, coinsurance and copayments if they qualify under the law
  • Excise “Cadillac” tax: Tax on high-cost health plans (set to go into effect in 2020 under the ACA or 2025 under the proposed AHCA). You can read more about why the Cadillac tax would hurt LIUNA health and welfare funds and members here.
  • Pre-existing condition policy: States that insurance companies can’t refuse to cover you or charge you more because of a health problem you had before getting new coverage
  • Health savings accounts (HSA): Allow you to set aside pre-tax dollars to pay for qualified medical expenses if you have a “high deductible” health insurance plan. Unlike a flexible spending account (FSA), HSA funds roll over year to year if they aren’t spent.
  • Actuarial values: Share of health care expenses a plan covers for a typical group of enrollees. For example, if a plan has an actuarial value of 70%, on average, you would be responsible for 30% of the costs of all covered benefits.

Medicaid-specific Terms

It’s often overlooked that the ACA was also responsible for expanding Medicaid, a program that provides health coverage to low-income adults, children, pregnant women, elderly adults and those with disabilities. At the end of 2016, Medicaid provided coverage to 69 million Americans.

As a result, Medicaid is a big part of the current health care discussion. Medicaid is funded by both the federal government and the states, with states providing guaranteed coverage to those eligible according to federal requirements.

  • Entitlement program: Government programs that guarantee certain benefits to a particular group based on various qualifications. Medicare, Medicaid, Social Security, Unemployment and Welfare are all examples.
  • Block grants: A proposal to provide a lump sum of money to each state for Medicaid. States would then decide who qualifies for various services. This would change the current funding system, which is open-ended based on the needs of those who are eligible.
  • Per capita caps: A proposal to set a per person limit on how much money the federal government would contribute to Medicaid. Funding would adjust based on the number of enrollees, not the cost of coverage.
  • Federal poverty level (FPL): Measure of income used to determine eligibility for certain programs and benefits, including Medicaid.
  • Children’s Health Insurance Program (CHIP): Matches federal funding for states that provide health coverage to children when their family’s income is too high to qualify for Medicaid but too low to afford private coverage.

Know Your Legislative Process

  • Executive order: Detailed more in last month’s article on deregulation, executive orders are signed by the President and instruct government agencies and departments on how to operate. Executive orders don’t require approval from Congress so they can be used to set policy while avoiding opposition.
  • Bill: Legislative proposal that if passed by both the House and the Senate and approved by the President becomes law. Each bill is assigned a bill number: HR denotes bills that originate in the House and S denotes bills that originate in the Senate.
  • Promulgate: Formally announce or declare that a new law or statute is going into effect.
  • Filibuster: Tactic used in the U.S. Senate to block or delay action on a bill or other measure.
  • Reconciliation: Allows for expedited consideration of certain tax, spending and debt limit legislation. Reconciliation bills aren’t subject to filibuster and the scope of changes is limited, giving this process an advantage for enacting controversial budget and tax measures.
  • Budget resolution: Establishes budget totals, divides spending into functional categories (e.g., transportation) and may include reconciliation instructions to House or Senate committees.

 

For more information, see the LHSFNA’s Glossary of Health Care Terms on our Health Care Reform page or order the Fund’s Answering Your Questions on the ACA series from the online Publications Catalogue.

[Jamie Becker, Director of Health Promotion; Emily Smith, Senior Benefit & Wellness Specialist and Nick Fox]