Q&A: What does the health care law mean for you?

[June 29, 2012]  WASHINGTON (AP) -- Free vaccines for kids, cheaper drugs for the elderly and many other benefits of President Barack Obama's health care law are already out there. More are coming, like a guaranteed right to buy health insurance even for patients with serious medical troubles. Many businesses and wealthy taxpayers, however, will see their costs go up.

And most Americans balk at the idea of the government making people carry insurance or pay a penalty on their federal tax returns.

The effects of the nation's health care law, upheld Thursday by the Supreme Court, are gigantic and growing. Some questions and answers about it:

Q: What does the ruling mean for me?

A: The ruling affects virtually every American. Obama's health care law tells almost everyone they must be insured and makes sure that coverage will be available to them even if they are already ill or need hugely expensive care. It helps the poor and many middle-class people afford the cost. And it requires insurers to provide certain basic benefits, like preventive care without co-pays from the patient.

Q: What did the Supreme Court say?

A: The court upheld almost all of the law, including the most disputed part: the requirement that virtually all Americans have health insurance or pay a penalty. The court said the penalty is essentially a tax, and that's why the government has the power to impose it.

The ruling somewhat limits the plan to expand the Medicaid insurance program for the poor, a joint effort of the federal government and states. It says the government may not withhold a state's entire Medicaid allotment if it doesn't participate in the expansion.

Chief Justice John Roberts sided with the court's four liberal justices -- Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan and Sonia Sotomayor -- to form the 5-4 majority.

Q: What does the decision mean for the November election?

A: It's a big win for Obama, dousing accusations that his signature legislation was an unconstitutional power grab. But Republicans hope the court's ruling will fire up their supporters and inflame popular opposition to the law.

Presumptive Republican presidential nominee Mitt Romney and GOP congressional candidates promise to repeal the law if voters put them in power.

Q: What's the law done so far?

A: Some parts, like the elimination of co-payments for preventive care, are already in effect. Young adults can stay on their parents' insurance up to age 26. Insurers can't deny coverage to children with health problems. Limits on how much policies will pay out to each person over a lifetime are eliminated. And hundreds of older people already are saving money through improved Medicare prescription benefits.

Q: What else is coming?

A: Unless Congress changes the law, starting in 2014 almost everyone will be required to be insured or pay a penalty. Subsidies will help people who can't afford coverage. Most employers will face fines if they don't offer coverage for their workers. Newly created insurance markets will make it easier for individuals and small businesses to buy affordable coverage. And Medicaid will be expanded to cover more low-income people.

Insurers will be prohibited from denying coverage to people with medical problems or charging those people more. They won't be able to charge women more than men, either. During the transition to 2014, a special program for people with pre-existing health problems helps these people get coverage.

The law is expected to bring coverage to about 30 million of the estimated 50 million uninsured people in the U.S.

Overall, more than 9 in 10 of the eligible population -- citizens and legal residents -- will be covered.

Q: Why will some people still go without insurance?

A: It's estimated that more than 20 million people will still be without coverage, including illegal immigrants, people who don't sign up and choose to face the penalties instead and those who can't afford coverage even with the subsidies. That number could be higher, depending on whether any states decline the Medicaid expansion.

Q: Do people like the law?

Not much. Some parts of the law have proven popular. But the individual insurance mandate is widely disliked.

Each time The Associated Press has asked in polls, more than 8 in 10 Americans have said the government should not have the right to require everyone to buy health insurance.

And the public has tilted against the law as a whole over the two years since it was passed. About half opposed it and a third were in favor in an AP-GfK poll shortly before the Supreme Court ruled.

Many elderly Americans are worried about the cuts in reimbursements paid to hospitals and insurers by Medicare, which have already started and will grow deeper.

Q: Does the insurance mandate affect many people?

A: Relatively few, because more than 8 in 10 Americans already have insurance coverage.

Employers face their own mandate. Those with 50 or more workers will be fined if they don't provide insurance for their employees, and opponents argue that will cost jobs at a time of high unemployment.

Q: Why impose a mandate that's unpopular and won't require any action by most people?

A: The mandate is designed to produce extra income from more healthy, paying customers so insurers can to hold down costs for everyone. Without the mandate, insurance companies probably would find it too expensive to comply with requirements to accept customers with pre-existing health problems and not charge them extra. Companies sought to control their costs by cherry-picking the healthy as their customers.

Q: Is the penalty for the uninsured a tax?

A: It will be collected along with income tax each year by the Internal Revenue Service.

But Obama and Democrats have avoided using the dreaded "t-word." Instead, they referred to it as a penalty for failing to act responsibly and focused publicly on other legal justifications. Before the Supreme Court, however, the Obama administration also argued that the law was constitutional under the federal government's power to levy taxes.

The court rejected the Obama administration's other two legal arguments for the law but accepted the tax one.

Still, most of the 20 million or more without insurance will not be docked. By 2016, about 4 million people will pay the penalty, the Congressional Budget Office has estimated. They would pay $695 for each uninsured adult or 2.5 percent of family income, up to $12,500 a year.

The IRS can't prosecute violators or place liens against them, however. Its only enforcement option may be withholding money from refunds.

Q: What other new taxes are in the law?

A: An assortment, including: Individuals making more than $200,000 a year and couples earning above $250,000 will get new payroll taxes. These people are also hit with a 3.8 percent tax on investment income. Medical-device makers will pay a 2.3 percent excise tax, which probably will get passed along to patients. Taxpayers will have to spend more on unreimbursed medical care before they can claim itemized deductions.

Q: What are Republicans saying?

"Obamacare was bad law yesterday. It's bad law today," Romney said.

Senate Republican leader Mitch McConnell said Obama deceived Americans by denying that the penalty on the uninsured amounts to a tax. The ruling marks "a fresh start on the road to repeal," he declared.

The Republican-led House already has voted for repeal -- and its leaders plan to repeat that vote next month -- but repeal is stuck there so long as Obama's in the White House and Democrats lead the Senate.

Q: What does Obama say?

A: He says the decision upholds the fundamental principle that in the wealthiest nation on earth, no one should be ruined financially by an illness or accident. Obama called it "a victory for people all over this country whose lives will be more secure because of this law."

Q: If the law survives in Congress, will the health care issue finally be put to rest?

A: No, there's more to do. Although the law is supposed to help curb costs, the nation's spending on health care already is enormous and sure to climb as the baby boom generation ages.

Skyrocketing budget deficits will force lawmakers to look for ways to save on the Medicare program for seniors and Medicaid for the low-income and disabled, and that means painful choices ahead.

[Associated Press; By CONNIE CASS]

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