Eight years after its introduction, many are still unaware of or confused by its major coverage provisions. Yet research demonstrates the ACA’s impact on medical care use, financial security and health outcomes.
The Affordable Care Act’s (ACA) consumer protections, premium tax credits, cost-sharing reduction subsidies and essential health benefits have made nongroup coverage more accessible and affordable, while its Medicaid expansion — now covering 36 states — has expanded access to healthcare.
What is the Patient Protection and Affordable Care Act?
The Patient Protection and Affordable Care Act (PPACA) is a United States federal law passed by the 111th Congress and signed into law by President Barack Obama on March 23, 2010. The act includes provisions designed to expand healthcare coverage, lower healthcare costs, improve market efficiency and eliminate industry practices such as cancellation or denial of coverage for preexisting conditions.
The American Medical Association endorses the goals of the Affordable Care Act, but does not agree with its method for accomplishing them. As an organization that is dedicated to patient-centric healthcare reform and has upheld fundamental principles consistent with AMA policy since 1907, they will work toward meaningful health system reform which offers individuals, businesses and governments options for the highest possible healthcare options available to them.
Key provisions of the Affordable Care Act include creating state and national health insurance exchanges, expanding Medicaid eligibility to individuals earning below 133% of federal poverty line and mandating large employers to offer health coverage to their employees. Furthermore, PPACA prohibits insurers from cancelling policies due to preexisting conditions as well as restricting rate increases based on actual risk rather than expected costs; medical director compensation changes have also been instituted by this act in order to eliminate incentives that guide patients toward high-cost facilities.
Who is the Patient Protection and Affordable Care Act for?
Obamacare (or Patient Protection and Affordable Care Act, as it has come to be known) entails three main goals: (1) to reform the private insurance market–especially for individuals and small-group purchasers; (2) to expand Medicaid coverage for working poor individuals; and (3) to change medical decision making processes through changes in incentives rather than government regulation and market forces. These ambitious aims rely heavily on changes in incentives, with expectations being set for rational decision making that meets market forces.
To fulfill these goals, legislation has implemented strict rules and restrictions on insurers; requires people to buy insurance; provides financial support (subsidies) to those who cannot afford coverage; prohibits insurers from excluding preexisting conditions from coverage or cancelling policies without sufficient cause; as well as setting consumer protection measures such as mandating all health plans to provide a summary of benefits and coverage explanation for each plan offered.
These new market-based reforms have met resistance both judicially and legislatively since they were first put in place, however the AMA remains optimistic that they can bring meaningful healthcare reform and additional steps should be taken on this path. Therefore, they provide information to patients to assist them in getting coverage as well as ensure continual improvements to law.
What is the Patient Protection and Affordable Care Act for?
There’s no question that the Affordable Care Act has transformed American health care. It has expanded Medicaid, and most people can purchase insurance through state-based exchanges (though enrollment has dropped during COVID-19 pandemic). Furthermore, the ACA reformed private insurance markets by mandating that companies offer comparable policies with relatively few variations in rates, cannot exclude preexisting conditions from coverage, and must use medical loss ratios as a way of evaluating risk.
As part of its strategy to alter medical decisions, Medicare has sought to change how hospitals and physicians make medical decisions by encouraging hospitals and physicians to reorganize procedures, negotiate alternative compensation schemes, and introduce more efficient technology. Unfortunately, market changes have yet to bring about their desired result: higher value care delivered efficiently at fair competitive prices.
At present, the Affordable Care Act (ACA) is facing several judicial challenges that threaten its enforceability. Most significantly, the Supreme Court is currently hearing arguments concerning whether its individual mandate is constitutional; they expect to make their decision sometime after 2022. In addition, various lower courts have taken up litigation regarding subsidization of exchanges as well as King v. Burwell which questions Medicaid expansion among other issues of concern with regard to this law.
