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All you need to know about Obama’s package
President Barack Obama called it a “patient’s bill of rights on steroids.” House Majority Whip James Clyburn referred to it as “the Civil Rights Act of the 21st century.” Conservative think tank The Heritage Foundation has labeled it the modern day “Intolerable Acts.”
Call it what you may, the Health Care Reform bill was passed by the House on Sunday and signed by President Obama on Tuesday. But what does this mean for college students? Just last week, Obama spoke at George Mason University in Washington, D.C., where he outlined the bill and how it will affect everyday people.
“Since you’ve been hearing a whole bunch of nonsense, let’s just be clear on what exactly the proposal that they’re going to vote on in a couple of days will do,” Obama said. The first aspect of the legislation is what Obama referred to as “the toughest insurance reforms in history.”
Thousands of uninsured Americans with preexisting conditions will be able to purchase health care. Insurance companies will be banned from denying coverage to children with preexisting conditions. Insurance companies will no longer be able to drop someone’s coverage when they get sick.
“And they’ve been spending a lot of time weeding out people who are sick so that don’t have to pay the benefits that people have already paid for,” Obama said. “Those practices will end.”
Last weekend, members of the QU Democrats visited Capitol Hill to watch the health care debates prior to the vote. President of the QU Democrats Mark Bouchard believes that the current health care system is plagued with increasing costs, reduced coverage and negligence toward those with preexisting conditions.
“I was appalled to see that so many people were protesting against health care reform and were so blindly adamant to uphold the status quo,” Bouchard said.
During his speech, Obama also highlighted a key benefit for college students — all new plans will allow young people to stay on their parents’ plan until age 26. According the Students Over Banks, a campaign of Campus Progress, more than 2 million previously uninsured young adults will benefit from this provision.
Obama said this change will give some security to young Americans after graduation.
“Because as you start your lives and your careers, the last thing you should be worried about is whether you’re going to go broke or make your parents broke just because you get sick,” Obama told the students of GMU.
Professor of Political Science Scott McLean believes this provision will address one of the biggest things college students struggle with after graduation.
“While paying off loans, looking for job, and not necessarily finding a job with health insurance benefits, it’s good to be covered by parents for that two or three years,” he said
McLean noted that young people change jobs a lot and tend to be very mobile. He believes having more affordable coverage for young adults can really help the economy.
“This will open up college students’ options in what their first job can be,” McLean said. “They can have a choice and can afford to do jobs they really want. You’d be able to even start a business as a young person, because you don’t have to worry about insurance.
“Young people are very mobile, they won’t necessarily stay in their home state. They can now follow opportunities without worrying about losing insurance.”
The second aspect of the legislation Obama outlined was the use of tax credits to help small business owners and those who are currently uninsured. Obama admitted these tax credits will cost money, about $100 billion per year.
“Unlike some of these previous schemes in Washington, we’re not taking out the credit card in your name, young people, and charging it to you,” Obama said. “We’re making sure this thing is paid for.”
The plan is to redirect money Obama described as “being poorly spent, that’s going to waste and fraud and unwarranted subsidies for the insurance company” and put it toward making insurance more affordable.
“Eventually, this will introduce costs to people who have health care,” McLean said. “Obamacare is on the individuals’ shoulders…. it gives employers who don’t provide health care a pass.”
He compared this to the health care program proposed during the Clinton administration that put the responsibility on employers.
McLean believes that providing coverage for 32 million previously uninsured people will make it more costly for everybody else.
“When you consider what you’re getting for that cost though, it’s not a bad deal,” he said. He admitted this healthcare reform will be expensive, but there are not that many alternatives that would be less expensive.
“The only way to get this cheaper would be a single payer plan,” McLean said. But he added, if you thought this bill was hard to pass, a single payer system would never be politically viable.
Obama addressed the opponents of the bill who question how the country can afford such reforms. For this, Obama referenced the Congressional Budget Office, or “the referee, the scorekeeper of how much things cost” as he described it. According to a report by the CBO released last Thursday, the reform bill will result in a $138 billion reduction of future federal deficits over the next 10 years.
“So here’s the point,” Obama said. “This proposal is paid for.”
But paying for the estimated 10-year, $940 billion price tag on new insurance coverage provisions in the bill isn’t as easy as Obama makes it sound.
Fortunately for college students though, one of the ways the government plans to cut costs will directly benefit students.
Beyond health care reform, Sunday’s vote also included an important piece of education reform. The bill that the House passed included the Student Aid and Fiscal Responsibility Act (SAFRA). According the Students Over Banks, SAFRA is a bill that will eliminate wasteful subsidies given to banks that function as the middlemen for student loans.
“Today Congress voted to stop wasting billions of taxpayer dollars to subsidize big banks, and start investing that money directly in our students and families,” Rep. George Miller, the chairman of the House Committee of Education and Labor, said on Sunday in press release.
Under SAFRA, all new federal student loans will originate through the Direct Student Loan programs, as opposed to the Federal Family Education Loan program. As a result, 500,000 students will not lose their Pell grants and the grants will not be cut by 60 percent for millions of other students as was feared with the current process.
The CBO estimates SAFRA will save $61 billion dollars over the next 10 years; this will help fund benefits for students such as increasing the maximum Pell grant to $5,550.
“This health care reform will greatly affect college students for years to come,” Bouchard said. “I believe that the bill’s passage in the House Sunday night is an incredible step in the right direction for our country and its citizens.”
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