H.R. 3962 is based on H.R. 3200 , America's Affordable Health Choices Act of 2009, which was originally introduced on July 14, 2009, and was reported separately on October 14, 2009, by three House Committees—Education and Labor, Energy and Commerce, and Ways and Means. Overview of H.R. 3962

This report summarizes the key provisions affecting private health insurance in the Affordable Health Care for America Act, as passed by the House of Representatives on November 7, 2009. The bill focuses on reducing the number of uninsured, restructuring the private health insurance market, setting minimum standards for health benefits, providing financial assistance to certain individuals, and, in some cases, small employers. In general, H.R. 3962 would include the following:
Individuals would be required to maintain health insurance, and employers would be required to either provide insurance or pay a payroll assessment, with some exceptions. Several market reforms would be made, such as modified community rating and guaranteed issue and renewal. Both the individual and employer mandates would be linked to acceptable health insurance coverage, which would meet required minimum standards and incorporate the market reforms included in the bill. Acceptable coverage would include coverage under a qualified health benefits plan (QHBP), which could be offered either through the newly created Exchange or outside the Exchange through new employer plans; grandfathered employment based plans; grandfathered nongroup plans; and other coverage, such as Medicare and Medicaid. The Exchange would offer private plans alongside a public option. Certain individuals with incomes below 400% of the federal poverty level could qualify for subsidies toward their premium costs and cost-sharing; these subsidies would be available only through the Exchange. In the individual market (the nongroup market), a plan could be grandfathered indefinitely, but only if no changes were made to the terms and conditions of the plan, including benefits and cost-sharing, and premiums were only increased as allowed by statute. Most of these provisions would be effective beginning in 2013. The report summarizes key provisions affecting private health insurance in Division A of H.R. H.R. The Exchange would not be an insurer; it would provide eligible individuals and small businesses with access to insurers' plans in a comparable way (in the same way, for example, that Travelocity or Expedia are not airlines but provide access to available flights and fares in a comparable way). 3962 , the Secretary of HHS would establish a public health insurance option through the Exchange. Any individual eligible to purchase insurance through the Exchange would be eligible to enroll in the public option, and may also be eligible for income-based premium and cost-sharing credits. 3962 , the Secretary would be required to negotiate payment rates for health care providers, and items and services (including prescription drugs), subject to limits. Consumer Operated and Oriented Plan (CO-OP) Program

The bill would also require the Commissioner to establish, in consultation with the Secretary of the Treasury, a Consumer Operated and Oriented Plan (CO-OP) program under which the Commissioner would make grants and loans for the establishment of not-for-profit, member-run health insurance cooperatives in the Exchange. 3962 , Exchange-eligible individuals could receive a credit in the Exchange if they
are lawfully present in a state in the United States, with some exclusions; are not enrolled under an Exchange plan as an employee or their dependent (through an employer who purchases coverage for its employees through the Exchange and satisfies the minimum employer contribution amounts); have modified adjusted gross income (MAGI) of less than 400% of the federal poverty level (FPL); are not eligible for Medicaid; are not enrolled in an employer's QHBP, a grandfathered plan (group or nongroup), Medicare, Medicaid, military or veterans' coverage, or other coverage recognized by the Commissioner; and are not a full-time employee in a firm where the employer offers health insurance and makes the required contribution toward that coverage.
This report summarizes key provisions affecting private health insurance, including provisions to raise revenues, in Division A of H.R. 3962, the Affordable Health Care for America Act, as passed by the House of Representatives on November 7, 2009. H.R. 3962 is based on H.R. 3200, America's Affordable Health Choices Act of 2009, which was originally introduced on July 14, 2009, and was reported separately on October 14, 2009, by three House Committees—Education and Labor, Energy and Commerce, and Ways and Means.
Division A of H.R. 3962 focuses on reducing the number of uninsured, restructuring the private health insurance market, setting minimum standards for health benefits, and providing financial assistance to certain individuals and, in some cases, small employers. In general, H.R. 3962 would require individuals to maintain health insurance and employers to either provide insurance or pay a payroll assessment, with some exceptions. Several insurance market reforms would be made, such as modified community rating and guaranteed issue and renewal. Both the individual and employer mandates would be linked to acceptable health insurance coverage, which would meet required minimum standards and incorporate the market reforms included in the bill. Acceptable coverage would include (1) coverage under a qualified health benefits plan (QHBP), which could be offered either through the newly created Health Insurance Exchange (the Exchange) or outside the Exchange through new employer plans; (2) grandfathered employment based plans; (3) grandfathered nongroup plans; and (4) other coverage, such as Medicare and Medicaid. The Exchange would offer private plans alongside a public option. Based on income, certain individuals could qualify for subsidies toward their premium costs and cost-sharing (deductibles and copayments); these subsidies would be available only through the Exchange. In the individual market (the nongroup market), a plan could be grandfathered indefinitely, but only if no changes were made to the terms and conditions of that plan, including benefits and cost-sharing, and premiums were only increased as allowed by statute. Most of these provisions would be effective beginning in 2013.
The Exchange would not be an insurer; it would provide eligible individuals and small businesses with access to insurers' plans in a comparable way. The Exchange would consist of a selection of private plans as well as a public option. Individuals wanting to purchase the public option or a private health insurance not through an employer or a grandfathered nongroup plan could only obtain such coverage through the Exchange. They would only be eligible to enroll in an Exchange plan if they were not enrolled in Medicare, Medicaid, and acceptable employer coverage as a full-time employee. The public option would be established by the Secretary of Health and Human Services (HHS), would offer three different cost-sharing options, and would vary premiums geographically. The Secretary would negotiate payment rates for medical providers, and items and services. The bill would also require that the Health Choices Commissioner to establish a Consumer Operated and Oriented Plan (CO-OP) program under which the Commissioner would make grants and loans for the establishment of not-for-profit, member-run health insurance cooperatives. These co-operatives would provide insurance through the Exchange.
Only within the Exchange, credits would be available to limit the amount of money certain individuals would pay for premiums and for cost-sharing (deductibles and copayments). (Although Medicaid is beyond the scope of this report, H.R. 3962 would extend Medicaid coverage for most individuals under 150% of poverty; individuals would be ineligible for Exchange coverage if they were eligible for Medicaid.)