What is ObamaCare? Understanding The Affordable Care Act (ACA)
Many people are aware of the basics of the Affordable Care Act (ACA).
- They are aware of benefits such as the ACA offering cost assistance for health insurance premiums and protections against preexisting conditions.
- Likewise, they are also aware of challenges that some families face like the rising cost of ACA-compliant health insurance and the requirement to get coverage, an exemption, or a pay a fee (that has now been reduced to $0 starting in 2019 on the federal level, although some states have their own mandates).
Those pros and cons of ObamaCare are important to understand, but they are only a small part of what the Affordable Care Act does and what its effects are.
Below we present some essential “ObamaCare Facts” to help you better understand what the Affordable Care Act (AKA “ObamaCare”) is, what it does, and how it affects you and your family.
OBAMACARE FACT: President Obama signed the Affordable Care Act into law, and that is essentially why the healthcare reform bill got the nickname “Obama” “Care.” However, healthcare reform has little to do with President Obama beyond that. The reality is, the law is the result of decades of collaboration between all political parties and the healthcare industry.
A Summary of the Affordable Care Act
The ACA was signed into law to reform the healthcare industry by President Barack Obama on March 23, 2010, and upheld by the Supreme Court on June 28, 2012.
The aim of the ACA was to address the “healthcare crisis” the nation was experiencing before the law was enacted.
In other words, the ACA was meant to address the fact that premiums were rising faster than inflation, that healthcare spending was raising as a percentage of GDP, and that the uninsured rate was increasing because of this.
An overview of the Affordable Care Act’s purpose can be stated as:
- The Affordable Care Act’s goal is to give more Americans access to affordable, quality health insurance and to reduce the growth in U.S. health care spending.
- The Affordable Care Act aims to accomplish its goal of expanding the affordability, quality, and availability of private and public health insurance through consumer protections, regulations, subsidies, taxes, insurance exchanges, and other reforms.
More specifically, the Affordable Care Act aims to accomplish the above goals by:
- Offering Americans some new benefits, rights, and protections in regards to their healthcare.
- Setting up a Health Insurance Marketplace (HealthCare.Gov) where Americans can purchase federally regulated and subsidized health insurance during open enrollment.
- Expanding Medicaid to all adults in states that embraced the program.
- Improving Medicare for seniors and those with long-term disabilities.
- Expanding employer coverage to millions of employees.
- Requiring most people to have coverage, get an exemption, or pay a fee for each month (the fee is reduced to zero in most states starting in 2019).
- Introducing new taxes and tax breaks.
Meanwhile, key benefits, rights, and protections under the Affordable Care Act include:
- Letting young adults stay on their parents’ plan until 26.
- Stopping insurance companies from denying you coverage or charging you more based on health status.
- Stopping insurance companies from dropping you when you are sick or if you make an honest mistake on your application.
- Preventing gender discrimination.
- Stopping insurance companies from imposing unjustified rate hikes.
- Doing away with lifetime and annual dollar limits.
- Giving you the right to a rapid appeal of insurance company decisions.
- Expanding coverage to tens of millions by subsidizing health insurance costs through the Health Insurance Marketplaces (HealthCare.Gov and the state-run Marketplaces).
- Providing tax breaks to small businesses for offering health insurance to their employees.
- Requiring large businesses to insure employees.
- Requiring all insurers to cover people with pre-existing conditions.
- Making CHIP easier for kids to get.
- Improving Medicare for seniors.
- Ensuring all plans cover minimum benefits like limits on cost-sharing and ten essential benefits including free preventive care, OB-GYN services with no referrals, free birth control, and coverage for emergency room visits out-of-network.
OBAMACARE FACT: Roughly 1 in 2 Americans technically have a “preexisting” condition according to a 2011 estimate done by HHS. That means half of us have a condition that we technically could have been charged more for or even denied coverage for in some states before the Affordable Care Act. The ACA chipped away at preexisting conditions until 2014 when discrimination against them by insurers was banned. Today preexisting conditions are no longer a barrier to insurance coverage for anyone, including high-risk customers. This means you can no longer be denied coverage or treatment or be charged more due to your health status. This is just one of many things the Affordable Care Act did and still doing today.
We’ve Only Just Scratched the Surface of What the Affordable Care Act Does
With all those ObamaCare Facts covered, we have still only just scratched the surface of what the ACA does!
The reality is, there are over a thousand pages of provisions in the ACA that do everything from requiring calorie counts at restaurants to rewarding hospitals that prioritize Medicare’s quality of care over its quantity of care.
We can’t cover everything on this page, so make sure to check out the links for more information.
Below are some additional ObamaCare Facts to help you better understand what you need to know about the Affordable Care Act ObamaCare.
Is ObamaCare Working? The uninsured rate fell to the lowest rate in recent history under the Affordable Care Act with over 20 million covered under all the Affordable Care Act’s coverage provisions (including Medicaid expansion, Marketplace coverage, the expansion of employer coverage, and young adults staying on their parents’ plan until 26). Further, between 2010 and 2016 the Affordable Care Act helped lower personal bankruptcies by nearly 50%! These are just a few examples of the ways in which ObamaCare is working… of course, as we noted above, ObamaCare also has its sticking points too.
Essential ObamaCare Facts for 2019 – 2020
For 2019-2020 there are three main things to consider. 1. Getting covered during open enrollment (as covered above), 2. making sure you are ready to file your taxes as they relate to healthcare at tax time, and 3. keeping an eye on the latest healthcare reform news (such as repeal and replace efforts).
With that in mind, here are some essential facts related to the above points for 2019 – 2020 (some of these points were already noted above, but they are reinforced here with some extra helpful links).
- ObamaCare’s 2021 Open Enrollment period for 2021 health plans starts November 1, 2020, and ends December 15, 2020.
- HealthCare.Gov is the official website to use if you want to lower costs on private health insurance and qualify for Medicaid under the Affordable Care Act! Make sure to shop during open enrollment for coverage inside or outside the marketplace.
- Those who use the marketplace may qualify for one or more of three different types of assistance based on family size and income. First, premium tax credits lower premiums. Second, out-of-pocket cost assistance lowers out-of-pocket costs on Silver plans. Third, Medicaid and CHIP are free or low-cost health insurance for low-income individuals and families.
- Options outside of open enrollment are limited to Short-Term Health Insurance, Medicaid, and CHIP. Keep in mind employer coverage and Medicare have unique enrollment periods. Learn more about enrollment periods.
- If you are getting cost assistance and your income changes throughout the year, make sure to update the Marketplace if your income or family size changes. If you take too many or too few of Advanced Premium Tax Credits, you’ll have to adjust them at tax time using form 8962.
- Despite rate increases, many families will be able to get a plan for less than $75, and 8 out of 10 less than $100! This is primarily because the ACA’s Advanced Premium Tax Credits cap premiums based on “household income and family size.” Learn more about how cost assistance works with the Affordable Care Act.
TRUMPCARE FACT: You should be aware that there have been a number of new rules passed and a number of fixes and ObamaCare replacement plans considered under Trump’s Presidency so far. These proposals and rule changes are collectively known by the nickname “TrumpCare.” Learn more about “TrumpCare.”
- “Patient Protection and Affordable Care Act“. Wikipedia.Com.
- “The Official Health Insurance Marketplace Website – HealthCare.Gov“. HealthCare.Gov.
- “Read the Affordable Care Act“. HealthCare.Gov.
- “Slower Premium Growth Under Obama“. FactCheck.Org.
- “The Rising Cost of Health Care by Year and Its Causes“. TheBalance.Com.
- “The HealthCare Crisis“. PBS.Org.
- “EFFECTS OF HEALTH CARE SPENDING ON THE U.S. ECONOMY“. HHS.Gov.