Big changes to your health insurance

NEW YORK (CNNMoney.com) -- September 23 marks the six-month anniversary of health reform. It's also the date when several key insurance changes come into effect.

Here's what you need to know about how your insurance is affected.

If you get insurance through your boss: Many people who are insured through work won't notice immediate changes to their health plans until their health plans renew, which is tied to companies' open enrollment periods. Health plans offered through large employers usually get renewed on Jan. 1.

But the mandates could kick in sooner for health plans sold to new entities or individuals after Sept. 23.

Here are some key changes coming into effect:

• Coverage expansion for adult dependents until age 26. Employers will have to provide coverage for dependents of workers who don't have access to other employer-based health care coverage 'till age 26. Some states already mandate this coverage until age 28 or 29.

This new provision could also push companies to look for ways to restrict the number of new people added to their health plans. [Employers get tough on insuring 'family' ]

• Children no longer denied coverage for pre-existing conditions: Insurance plans can't deny coverage due to a pre-existing condition to children under age 19. For adults, the same provision goes into effect in 2014.
• Prohibit insurers from rescinding coverage: It's illegal for insurers to drop a customer when they become sick or search for an error on a customer's insurance application and then deny payment for service when the person gets sick.
• Free Preventive Care: All new plans must cover certain preventive services such as mammograms and colonoscopies without charging a deductible, co-pay or coinsurance. If individuals keep their existing plans or if a group plan doesn't make major changes, the provisions won't kick in until the plans get changed. [Health reform: What you're not getting]
• No lifetime limits on coverage: Insurers no longer can impose lifetime dollar limits on essential benefits, like hospital stays or expensive treatments.
• Unrestricted doctor choice: Plans must allow pediatricians and obstetrician/gynecologists to get primary care physician status. This eliminates the requirement for patients to get prior-authorization from their insurer or a doctor's referral to see a pediatrician or OB/GYN.
• Level charges for emergency services: Insurers must remove prior authorizations for ER services. Also, insurers can't charge higher co-payments or co-insurance for out-of-network ER providers.
• Patient-friendly appeals process: Insurers will have to establish new internal and external appeals processes for claims. This means that while a claim is under appeal, your insurer has to continue to pay your claims, and continue paying for subsequent treatment, until the matter is resolved.

Small business impact: The changes that kick in on Sept. 23 also apply to small businesses with 50 employees or more that already offered insurance coverage prior to reform.

Companies that didn't offer coverage pre-reform and have no more than 25 workers will be given incentives such as tax credits and grants to encourage them to offer insurance coverage, said Dorothy Miraglia, director of benefits with AlphaStaff, a firm that manages employee benefits programs for small businesses.[Tax change for small businesses]

The government estimates that 4 million small businesses will be eligible for health insurance tax credits. These include a credit of up to 35% of the premiums employers pay on worker plans. For small non-profit companies, the credit is up to a 25%.

Also, the 35% maximum credit is given to employers with 10 or fewer full-time employees, said Miraglia.

If you buy insurance yourself: For consumers who buy health insurance directly from insurers, some of the same key changes go into effect this month.

Most importantly, insurers can't drop you when you get sick or because you made a mistake on your coverage application. Insurers also can't set annual or lifetime limits.

If you have children under age 26, you can insure them if your policy allows for dependent coverage. Individual plans can't deny or exclude coverage to any child under age 19 for pre-existing conditions.

If you're a senior citizen: If you have Medicare prescription drug coverage and are affected by the donut hole, this year you will get a one-time tax-free $250 rebate to help pay for prescriptions.

The prescription drug coverage gap that develops when Medicare stops paying for drug coverage and patients can't afford to pay for drugs out-of-pocket is called the "donut hole."

In 2011, if high prescription drug costs put you in the donut hole, you'll get a 50% discount on covered brand-name drugs while you're in the donut hole.

Also in 2011, Medicare will cover certain preventive services without charging you Medicare Part B (coverage for doctors' services, outpatient care, home health services) coinsurance or deductible.

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