Pelosi Statement on Affordable Care Act Provisions Effective January 1, 2011


Washington, D.C. – Speaker Nancy Pelosi released the following statement today on key components of the Affordable Care Act that will go into effect on January 1, 2011.  These provisions will require insurers to spend 80 to 85 percent of premiums on medical care; cut government overpayments to insurance companies; give primary care physicians and general surgeons a 10 percent increase in their Medicare reimbursement; reduce the costs of prescription drugs for seniors and provide them with free preventive services:

“Congress passed health insurance reform to ensure that patients and their doctors are in charge of their health, not insurance companies.

‘Starting January 1, insurance companies will have to spend a larger share of premiums on the care of patients and consumers – not on CEO salaries.  Taxpayers will save, as government cracks down on overpayments to insurers.  Seniors will gain free access to annual check-ups and screenings, and those in the ‘donut hole’ will get a 50 percent discount on brand-name prescription drugs.

“In 2010, we kept our promises by helping small businesses cover their employees and seniors afford prescription drugs.  We gave young people the security of knowing that they can stay on the parents’ plans until age 26.  And we ended shameful insurance practices that canceled coverage when someone gets sick or denied care to a child with a pre-existing condition.

‘Democrats will fight to preserve these gains for the American people in the months and years to come, while continuing to focus on creating jobs for the middle class.”

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The following provisions of the Affordable Care Act take effect on January 1, 2011.  HHS has updated the state-by-state information on the implementation of health reform that is available at HealthCare.gov.

For all health care consumers:

•    Health insurance companies are now required to spend 80 to 85 percent of premiums on health care and quality improvements for patients–not on overhead or CEO salaries. Insurers who have not redirected premiums so that at least 80 percent goes to customer care will be required to provide a rebate to their customers starting in 2012.

For seniors:

•    Increasing Reimbursement for Primary Care – Provides a 10 percent Medicare bonus payment for primary care physicians and general surgeons.

•    Seniors who reach the doughnut hole coverage gap for prescription drugs will receive a 50 percent discount when buying brand-name medications. Over the next ten years, seniors will receive additional discounts until the coverage gap is closed.

•    Preventative Care – Seniors will receive free preventive services, such as annual checkups and certain preventative screenings.

•    The Community Care Transitions Program will help high-risk Medicare beneficiaries who are hospitalized avoid unnecessary readmissions by coordinating care and connecting patients to services in their communities.

•    The Center for Medicare and Medicaid Innovation will begin testing new ways of delivering care to patients.  These new methods are expected to improve the quality of care and reduce the rate of growth in costs for Medicare and Medicaid.

Already the Affordable Care Act has opened up access to quality health care and helped small companies provide health insurance to their employees.  Provisions that took effect in 2010 include:

•    Prohibiting denial of coverage to children who were excluded due to pre-existing conditions

•    Extending coverage to young adults up to age 26 so they can stay covered as they start their careers

•    Delivering tax relief for small businesses to help them continue to provide health insurance to their workers

•    Creating a system to help early retirees not yet eligible for Medicare keep their savings and stay insured

•    Requiring all new plans to provide free preventative screenings including mammograms and colonoscopies

•    Ending insurance companies’ ability to rescind coverage when people get sick or impose lifetime caps on those with chronic illness

•    Investing millions into community health programs and helping states provide coverage for low income families through Medicaid

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