Known more commonly by its nickname ObamaCare, the Patient Protection and Affordable Care Act (ACA) makes health insurance accessible for millions of Americans. Employers are required to offer coverage or pay a penalty; additionally, an exchange exists that offers discounted policies.
Additionally, this law protects you against being denied coverage due to preexisting conditions or dropped midtreatment; additionally it limits premium increases.
The Individual Mandate
The individual mandate requires all Americans to purchase health insurance or face a penalty, in order to spread out costs evenly among healthy and sicker individuals and make premiums more affordable. Prior to the ACA, insurers could deny coverage to people with preexisting conditions or charge significantly higher premiums; now this obligation must be fulfilled equally across society.
The Affordable Care Act offers several exemptions to its individual mandate requirement; thus removing most people from its scope. However, many states also enacted their own individual mandates – California, DC, Massachusetts NJRIVT have passed state individual mandates so far.
If the individual mandate was repealed, its costs would shift from newly insured people back onto taxpayers due to how the Affordable Care Act expands Medicaid and offers subsidies to help low-income households afford private insurance premiums. In addition, consumer protections would increase by restricting insurance company practices which can harm consumers such as lifetime limits on benefits and denial of coverage for preexisting conditions – without which many families would incur significantly higher health care expenses without this protection.
The Exchanges
Before Obamacare was implemented, most Americans had few health care options. People with preexisting conditions were often denied coverage or faced high rates from insurance providers; plans could even be cancelled when someone became sick.
The Affordable Care Act (ACA) offers most Americans access to affordable health care through State and Federal Marketplaces known as Exchanges, where insurance companies must spend at least 80% of premium dollars on medical costs or preventative health services; it also prohibits them from denying coverage due to preexisting conditions or raising rates accordingly.
As of 2014, the Affordable Care Act prohibits lifetime limits on coverage (effective immediately) and requires all insurers to offer at least 10 essential health benefits. Furthermore, it enables basic health plans and expands Medicaid; and adds taxes on a range of products and services such as tanning salons, pharmaceutical companies, etc.
The Subsidies
Barack Obamacare makes having health insurance mandatory, and failing to do so incurs a fine. Furthermore, subsidies exist in order to make plans more cost-effective for low-income families.
Premium assistance subsidies (also referred to as PTC tax credits) provide assistance in lowering the cost of marketplace plans that meet certain criteria, and may assist those earning up to 400% of federal poverty level with cost sharing reductions that help decrease out-of-pocket expenses like deductibles and copays.
ACA subsidies have helped increase enrollment in healthcare marketplaces, yet Republicans have proposed cutting them back to help address our nation’s deficit. This could impact future enrollment; additionally, if your income changes during the year and you receive subsidies as a result of it, any payments may need to be returned or reimbursed back – thus emphasizing why reporting annual income to tax officials annually is imperative.
The Taxes
Reddit user cnash6 points out that churches are exempt from this provision). Additionally, it establishes new benefits, rights, and protections for consumers; stops insurance companies from denying coverage to preexisting conditions or raising premiums; expands Medicaid; and opens Health Insurance Marketplaces that help subsidize private plans.
It will cost trillions and put us in massive debt! The Affordable Care Act does include some new taxes – on tanning salons, pharmaceutical companies and medical devices – however most of the money comes from savings within Medicare that must go back into increasing solvency or improving services, helping reduce deficit over time. Furthermore, preventive health measures are emphasized within ACA to decrease overall healthcare spending costs – so as not spending so much treating illness after it occurs.
