The Affordable Care Act is a law that has made significant changes to the nation’s health care system. It has expanded coverage, increased consumer protections and focused on prevention and wellness.
Some people may qualify for a premium tax credit to help them pay for their insurance. These subsidies are available to individuals who earn less than 400% of the federal poverty level (FPL).
Tax credits
The Affordable Care Act (ACA) includes tax credits that lower premiums for people who purchase insurance through the health insurance marketplaces. These subsidies can be applied to your monthly premium or refunded on your federal income taxes at the end of the year.
During the ACA’s open enrollment period, which runs November 1 to January 15, people can apply for health insurance through the Marketplace online or in person. They must meet income and family size criteria to qualify.
To help people afford health coverage, the ACA allows them to receive advance payments of the premium tax credit directly from their Marketplace plan insurer each month. However, enrollees must report any changes in their income or household size in order to get a higher advance payment or lower their monthly premium payments.
In 2021, the Biden Administration extended ACA advance premium tax credits to people with incomes up to 400 percent of the federal poverty level (FPL) for five years. This was a temporary solution that helped protect some Americans from the so-called “subsidy cliff” of higher premiums.
Preventive care
Getting preventive care helps Americans stay healthy and avoid or delay the onset of diseases. It also saves them money by reducing future healthcare costs.
Preventive care is health screenings, vaccinations, and other services to help people prevent disease or illness. These are often provided by your primary care provider (PCP).
In 2010, the Affordable Care Act made it easier for most Americans to afford health insurance by requiring private plans to cover evidence-based preventive services and eliminate cost-sharing like copayments or deductibles.
These requirements apply to all plans in the individual, small group, and large group markets except those that maintain their grandfathered status. They also apply to those who qualify for Medicaid expansion under the Affordable Care Act. In addition, the ACA holds private insurers accountable for charging fair premiums, whether for individual market policies or for employer-sponsored coverage.
Expansion of Medicaid
The ACA’s Medicaid expansion helped millions of people afford health insurance. In particular, it gave low-income adults access to Medicaid through the ACA marketplaces and provided additional coverage through marketplace financial assistance for families with children.
Studies show that adults in states that have expanded Medicaid have improved their access to care, especially through increased use of prescription drugs and the treatment of chronic conditions. They also reported a lower level of medical debt and have lower concerns about paying for health care.
In addition, studies have shown that children in states that have expanded Medicaid have better health and educational outcomes. These improvements may be due to better access to prenatal care for mothers, which is known to promote fetal health in later life.
However, many states still refuse to expand their Medicaid programs. Despite the federal government’s incentives to expand Medicaid under the Affordable Care Act, governors and state legislators can opt out of Medicaid expansion without losing any federal funds.
Health insurance for young adults
Health insurance is an important protection against unexpected expenses. It can also be a key tool in reducing medical debt and helping people cope with serious illness or injury.
The Affordable Care Act provides a number of ways to afford health insurance for young adults. First, millions of young adults are now able to remain on their parent’s health plans until they turn 26.
Second, the law offers a number of government subsidies to help lower- and middle-income individuals offset the cost of health insurance. These subsidies can be used to buy insurance on the federal exchanges or through private health insurers.
In addition, the law’s age rating rule restricts insurers from charging older people more than three times the premium paid by younger adults. This rule has lowered relative participation in nongroup coverage among young adults.
