Health Care Reform Cheat Sheet

Last Updated Jul 16, 2009 12:14 PM EDT

The House Committees on Ways and Means, Energy and Commerce and Education and Labor, as well as the Senate Health Committee (the Senate Finance Committee has not yet presented its version), have come up with 1,000+ pages of health care reform. I was asked to turn those proposals into a two-minute segment on the CBS Early Show this morning.


Boiling down legislative babble was an exhausting exercise, but it was a great opportunity to put together my own "cheat sheet" on health care -- here goes!

I will use the House plan as the jumping off point and note differences with the Senate's version.

  • Costs $1.04 trillion over 10 years (Congressional Budget Office) [Senate plan would cost more]
  • Covers 97% of legal American citizens
  • Mandates all individuals to purchase insurance or pay penalty of about 2.5% of gross income
  • Establishes insurance exchange where consumers can compare policies and buy coverage
  • Includes Public Options to compete with private insurance
  • Individual subsidies: The government will offer assistance (credits) on a sliding scale up to four times the poverty level (up to $43K for individual and $88K for a family of 4)
  • Requires employers to provide health coverage or pay a fee to the government [Senate plan is $750/employee for employers with > 25 employees]
    • Payroll > $400,000 = 8% of Wages
    • Payroll $250,000-$400,000 = to be determined (smaller penalty)
    • Payroll < $250,000 = NO FEE
  • Bars insurance companies from denying coverage due to illness or health status
  • Eliminates insurance company lifetime caps








Where's this money coming from?
Under the House plan, there are three main sources available to fund health care [The Senate plan seemed to pass over this not-so-small detail]:

1) New Taxes on Wealthy Generating $544 Billion

  • 5.4% surtax income > $1M
  • 1.5% surtax on income $500,000 - $1M
  • 1% surtax on income $350,000 - $500,000 (starts at $280,000 for individuals)
2) Surcharges on Businesses (see above)

3) Reduction in spending for Medicare and Medicaid



Sticking Points:

  • New taxes on rich
  • Impact on small businesses
  • Change in care--Americans will wonder whether their doctors will participate in public option
What's next?
Now the fun begins. The Senate Health and Finance Committees must agree to a unified version of the bill. Then, the House and the Senate start to wrangle over a compromise. Once that's done, the bill goes to the President for signing.
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    Jill Schlesinger, CFP®, is the Emmy-nominated, Business Analyst for CBS News. She covers the economy, markets, investing and anything else with a dollar sign on TV, radio (including her nationally syndicated radio show), the web and her blog, "Jill on Money." Prior to her second career at CBS, Jill spent 14 years as the co-owner and Chief Investment Officer for an independent investment advisory firm. She began her career as a self-employed options trader on the Commodities Exchange of New York, following her graduation from Brown University.