Report: Reform Law’s Spending Caps To Benefit Calif. Residents

The out-of-pocket spending caps included in the federal health care reform law will help prevent Californians and other U.S. residents from facing financial crises related to the cost of medical care, according to a new report by Families USA, the Los Angeles Times' "Money & Company" reports.

Background

Starting in 2014, the reform law will limit the amount of out-of-pocket expenses that insured individuals must pay for health care services.

When the new spending limits take effect, consumers will pay a certain share for essential health services -- such as physician visits, hospital stays, emergency care and prescriptions -- and health plans will cover the remaining costs.

The caps would apply to health insurance plans sold through the health insurance exchanges scheduled to open in 2014 in California and other states.

Key Findings

If the reform law's spending caps were adjusted to 2011, the caps would be $5,950 for individuals and $11,900 for families of any size, according to the Families USA report.

The report predicted that more than 1.9 million Californians will spend more than those out-of-pocket caps this year. The extra spending would exceed the caps by a total of more than $3 billion, according to the report (Helfand, "Money & Company," Los Angeles Times, 3/1).

Other States

Families USA also released reports on the effects of the out-of-pocket spending caps on other states. For example:

• More than 1.5 million Texans are in families that would exceed the out-of-pocket caps by a total of $2.6 billion in 2011 (Danner, San Antonio Express, 3/1);
• About 590,500 Illinois residents are in families that would exceed the caps by more than $1 billion in 2011 (AP/St. Louis Post-Dispatch, 3/2);
• About 147,300 Utah residents are in families that would exceed the caps by about $197.4 million in 2011 (Stewart, Salt Lake Tribune, 3/1); and
• About 140,000 Connecticut residents are in families that would exceed the caps by a total of more than $249.3 million in 2011 (Hartford Business Journal, 3/1).