Confused? Here is what you need to know about ObamaCare in 3 minutes!
The Patient Protection Affordable Care Act (ACA), better known as “ObamaCare,” became law in 2010. Since it looks like the policy is going to change the way we use health care, let’s take a quick look at what it has in store for you.
The original bill is around 1,000 pages, and trust me, "it can be a dry read!" But here is the gist of what might be helpful to know:
- Individual Mandate: Probably the most controversial aspect of the law, the Individual Mandate basically requires every American citizen living in the US to have health insurance.
- If you current plan meets the ACA standards, you are good for the time being!
- If you don’t have a plan that meets these standards, you will have to buy a health plan through one of the health exchanges.
- ObamaCare Penalty: If you choose not to have health insurance or currently hold a policy that doesn’t meet the law’s standards you are going to be subject to a financial penalty. Penalties start at $95/adult and 47.50/child during the first year, and progressively increase.
- Health Exchanges: State or federally established “marketplaces” where consumers can compare plans, buy private insurance, apply for Medicaid or apply for cost assistance. Important to note, ObamaCare is there to regulate health insurance companies and not to create its own new insurance business.
- To learn more about health exchanges, check Health Exchanges 101.
- Goodbye Pre-Existing Conditions: The Law eliminates discriminating against Americans with pre-existing conditions, so insurance companies can no longer deny you coverage because of a chronic illness or disease.
- Insurance companies can’t drop you when you become sick. Also, if you or anyone in your family becomes sick, the insurance company can no longer raise your rates or limit how much insurance you use.
- Lifetime and annual caps, gone… kinda! If you paid for your insurance properly, the company can’t tell you that you used too much and so won’t pay for your coverage after a certain point. Insurance companies can’t do this for lifetime spending, but have limited freedom with yearly spending.
- No discrimination...Sorta: You are protected from gender discrimination and insurance plans are limited in terms of how much they can charge you based on your age.
- The law provides free preventative services as well as numerous other health benefits (no-copay): Most families will have access to wellness programs, pregnancy exams, and newborn care for free. Similarly, diagnostics and lab tests that are conducted for preventative purposes will be provided for free. However, not all health benefits are free, some will have copay and coinsurance.
- To learn more about health benefits, check ObamaCare Essential Health Benefits.
- ObamaCare expands Medicaid and CHIP coverage. Now one can qualify for Medicaid if his or her income is within 138% of the federal poverty level (FPL). However, if you reside in a state that didn’t expand medicaid coverage, the threshold is usually within 100%-103% of FPL.
- The notorious Medicare “donut hole” gap in coverage will be terminated over the next five years. The goal is to enclose this gap effectively by 2020.
- Now, businesses with more than 50 employees must provide health insurance for their employees, and may receive tax credits to help supplement costs. If a company opts out of providing insurance, it will be penalized $2,000 for every employee who is uninsured. Unfortunately, the 50th employee will be an expensive hire for most growing company!
- Small businesses(<50 employees) will get to purchase insurance through the Small Business Health Options Program (SHOP) marketplace.
- Young adults can stay on their parent’s insurance plans until they turn 26, so now they can focus on finding a job, getting out of the basement, and hopefully be ready to get their own insurance once they hit 26!
- Cost Assistance: Tax credits and subsidies will be available for some Americans to make it easier for them to afford insurance through the exchange.
- To learn more about if you qualify for financial support, try our online survey.
To learn more about how shop smarter for health plans or for more information about health care in general, visit TakeCommandHealth!
I wrote this blog to help people make smart health insurance decisions. I am a small business owner, a husband, and a dad to three boys, so I've seen firsthand how important understanding insurance decisions can be. As a co-founder of Take Command Health and a licensed health professional, I've been recognized as a leading expert on healthcare transparency and defined contribution arrangements (QSEHRA). I've been featured in the New York Times, Wall Street Journal, Dallas Morning News, Forbes and others. Learn more about me and connect with me on our about us page. Thanks!