 Like a lot of people, you probably saw a lot in the news about health care reform in 2010. And, like a lot of people, you might not actually have gotten a chance to understand what it does. So let's dig in, eh? To start with, we're going to call it health care reform rather than its other name. Yes. Regardless of what you think about health care reform, this is a fair discussion of it. So no nicknames. Also, here's an interesting congressional procedural fact you may not know about health care reform. It's actually two laws because of the way the, alright fine, smarty boots. Also, while the Supreme Court has already heard its case, the law may change at some later date. Maybe a different president or congressional leadership will want to change parts of it. So this information might change too. Now, if you're like most people, you get your health care through some form of health insurance. There were a lot of changes to how health insurance is regulated. First, imagine you have insurance, you get sick, and you file a claim. Not just a claim, an expensive claim. Something expensive to treat. There's a practice called Recision, where insurance companies have been known to go back to their files and if there's a mistake, or if the patient didn't declare an illness that they had, even a minor one, they revoke coverage. The law has been changed so they can only drop you if you stop making payments or if you knowingly lie on your application. Second, insurance companies aren't allowed to limit how much in cost they pay over the life of your policy or in a single year. Though they aren't required to pay more than 2 million a year until 2014. They are still allowed to limit what they give in specific categories of benefits, like prescriptions, doctor's visits, and so on. Third, by 2014, all plans need to cover certain preventative measures with special ones just for women, like contraception. Certain religious workplaces don't have to pay for contraception. This was a change in the policy after the issue got really big in the news. Fourth, insurance companies have to spend 80% of their budgets on health care or internal improvements instead of on things like salaries or administrative costs. If not, they have to issue rebates. Parents can keep their kids on the insurance until those kids are 26, whether or not they live at home. And certain conditions or illnesses will be required to be covered by everyone's insurance. Let's say you don't have health insurance. How are you affected? First, come 2014, insurance companies will be required to provide insurance to people with pre-existing conditions at the same cost as anybody else. If you're older, you can be charged higher premiums, but only up to three times as much as a younger patient. Until then, children under 19 with high-risk conditions must be given insurance but can be charged more. There will be a temporary government high-risk insurance program for adults until 2014. Second, new online insurance marketplaces have been created to allow people to shop for insurance for themselves and small business owners to shop for insurance for their employees. Make sure you use the right web address. There will also be insurance aid from the government for low-income individuals and families, as well as aid for out-of-pocket expenses. There will be online tools to help you compare the different insurance plans and even to point you to government programs you qualify for. You can only use the exchanges if you don't have insurance provided by your job or if that insurance costs more than 9.5% of your income. Third, if you're under 30 or if your current insurance costs more than 8% of your income, you can buy a new catastrophic plan that covers three doctors' visits a year and essential benefits. Fourth, any business that employs more than 50 people must offer insurance that meets all these standards or face penalties. One major new change that has been very controversial and even went to the Supreme Court was the individual mandate, which requires everyone to have health insurance or pay attacks. To explain the mandate, let's start by explaining a little about how insurance works. Insurance works by getting a group of people together and taking the money all of them pay in small amounts every month to cover their overall medical expenses. This only works if they're not all sick at the same time because then the payments in would be too little to cover the payments out. The best customers for an insurance company to have are people who never get sick because it means getting money in without giving money out. This is why insurance companies sometimes try to kick sick people off because too many sick people means you start losing money. But if you're sure you're going to be healthy, then getting insurance doesn't do anything for you any more than getting car insurance makes sense when you don't drive. Of course, people are often wrong about whether they will be sick. The mandate will pull all the healthy people who don't get insurance into the pool to help pay for all the sick people the insurance companies now have to cover and all the extra payments they'll be making under the new rules. You are exempt if your religious beliefs prevent you from buying insurance, if you're on a government health benefits program, if you would be paying more than 8% of your income for the cheapest plan even after subsidies, if you don't make enough money to file a tax return, if you live outside the US or if you are Native American. By 2016, the penalty will be $695 for individuals or $2085 for families or 2.5% of income, whichever is greater. You'll pay it as part of your tax return every year. So that is, in a nutshell, all the changes to health insurance from healthcare reform. And there you have it.