Private Health Insurance: Changes Made by H.R. 4872, the Health Care and Education Reconciliation Act of 2010

Hinda Chaikind
Specialist in Health Care Financing

Bernadette Fernandez
Analyst in Health Care Financing

Mark Newsom
Analyst in Health Care Financing

Chris L. Peterson
Specialist in Health Care Financing

On March 23, 2010, the President signed into law H.R. 3590, the Patient Protection and Affordable Care Act (PPACA) as passed by the Senate on December 24, 2009, and the House on March 21, 2010. The new law will, among other changes, make statutory changes affecting the regulation of and payment for certain types of private health insurance. 

On March 21, 2010, the House passed an amendment in the nature of a substitute to H.R. 4872, the Health Care and Education Reconciliation Act of 2010 (hereafter referred to as the reconciliation bill). The reconciliation bill was written as making amendments to PPACA and is now before the Senate for consideration. On March 25, 2010, the bill passed the Senate with amendments and has been sent back to the House. 

This report summarizes only the private health insurance provisions in the reconciliation bill and their impact on PPACA. For a description of all the private health insurance provisions in H.R. 3590, see CRS Report R40942, Private Health Insurance Provisions in Senate-Passed H.R. 3590, the Patient Protection and Affordable Care Act. 
Among the changes that would be made by the reconciliation bill to PPACA are the following which, except for the first two, would apply beginning in 2014: 

• extend to grandfathered plans, starting for plan years six months after enactment, the prohibition of lifetime limits, prohibition on rescissions, limitations on excessive waiting periods, and a requirement to provide coverage for nondependent children up to age 26; 

• for coverage of adult dependent children prior to 2014, the requirement on grandfathered group health plans would be limited to adult children without an employer offer of coverage; 

• make certain changes to the calculation of the penalties imposed on persons who are not in compliance with the individual mandate; 

• modify a rule regarding the exemption from the individual mandate; 

• make changes to how the employer penalties would be calculated; 

• include full-time equivalents in the counting of full-time employees; 

• strike the employer fee based on extended waiting periods; 

• for grandfathered group health plans, prohibit pre-existing condition exclusions and restrict annual limits; 

• increase premium credits and cost-sharing subsidies to certain low- and middleincome individuals enrolled in private coverage through an exchange; and 

• alter how income is counted for purposes of determining eligibility for premium credits and cost-sharing subsidies.


Date of Report: March 25, 2010
Number of Pages: 13
Order Number: R41126
Price: $29.95

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