The Vision Council Update on Health Care Reform


The Vision Council has provided some helpful updates on Health Care Reform that we would like to share with you regarding On March 30, 2010, the President signed into law the heavily debated health care reform legislation – so what happens next? There are some immediate changes that will take effect as well as a steady time line for implementation. Here is how the optical industry will be affected by the new health care reform law.

What happened to vision care?

  • Eyeglasses have been exempt from the medical device tax included in the most recent version of the bill. While this includes most of The Vision Council membership, The Vision Council Public Affairs and Advocacy Department will work with the Secretary to prevent any tax burden on all medical devices manufactured by our members.
  • There will be more Americans receiving vision care because of health care reform.
    o Pediatric vision care will include individuals up to the age of 22 as a result of the extension of the WellBaby Program which includes vision care. Care and product will be covered for those with diagnosed vision problems.
  • Optometrists and ophthalmologists will have increased and equal reimbursement rates for their services.
  • The amount of pretax dollars available for an individual to place into a Health Flexible Spending Accounts (HSA) will be reduced from $5,000 to $2,500 and could cause people to pay out of pocket or rely on government assistance when receiving optical services or purchasing medical devices. This will be effective December 31, 2012.

What happens to business in this new law?

This legislation mandates individual businesses to offer insurance. Its goal is to help get as many Americans as possible into the system by providing businesses incentives for offering health insurance and imposing penalties on those that don’t.

Large Businesses

Most large businesses already offer health care of some sort to their employees. In the future, those businesses could have premiums reduced because the cost for overall insurance will go down with the addition of 31 million Americans in the system. However, this is not guaranteed because an unknown number of them may have preexisting conditions, come from high risk pools or could reach their annual/lifetime caps. Because of this, premiums could also potentially stay at current levels. If you currently are offering a “Cadillac” health care plan, taxes will be levied on such plans in 2014. Also, if you are a company with over 50 employees and do not offer health care benefits or if you don’t cover 60 percent of overall employee health costs, there will be penalties beginning in 2014.

Small Businesses

The definition of small business varies by state (i.e. less than 10, 50 or 100), but a majority of the programs described in the new health care law are for businesses with 50 employees or under. Starting in the next six months (by 2011) if you currently do not offer all or any of your employees health care benefits and you have a company of 10-25 employees earning $25,000-$50,000 annually, you may be eligible for a 35 percent tax credit back on the premium paid to extend benefits to those employees. Starting in 2014, small businesses will be eligible to buy health care benefits through state health insurance pools called SHOP exchanges (Small Business Health Options Programs). These allow small businesses to group together to buy health insurance at the same rates as larger businesses. Companies with 10 or less employees may also receive a 50 percent tax credit.

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