Obamacare, or the Patient Protection and Affordable Care Act, came into effect March 23rd of 2010. Since that date, various components have been implemented into its implementation process.
A new law permits young adults to remain on their parent’s insurance until the age of 26 and prohibits lifetime or annual caps on health insurance payments.
1. Expansion of Medicaid
The Affordable Care Act expanded Medicaid eligibility for low-income parents and adults without dependent children whose income fell within 138% of the federal poverty line, fully funded by the federal government up until 2016. Subsequently, matching rates will gradually decline until reaching 90% by 2020 and thereafter.
The Affordable Care Act’s coverage reforms have led to significant increases in U.S. healthcare enrollment. Private nongroup coverage has become more affordable; premium tax credits and cost-sharing subsidies make enrollment easier; while its essential benefit package has made coverage more comprehensive. Evidence also exists of positive short-run outcomes of expanding Medicaid, such as improved dietary choices and reducing risky behaviors.
2. Tax Credits for Individuals
The Affordable Care Act (ACA) offers premium tax credits to reduce out-of-pocket expenses for persons purchasing marketplace coverage, prohibits lifetime and most annual dollar limits on coverage as well as preexisting condition exclusions and excessive waiting periods for coverage, creates health insurance marketplaces with comprehensive benefit packages that meet actuarial value requirements, risk adjustment mechanisms such as corridors and reinsurance to help stabilize premiums and balance risk between insurers, and establishes health insurance marketplaces with comprehensive benefit packages that meet these criteria.
Although the Affordable Care Act has seen considerable successes in its early years, the law has also faced its share of hurdles and difficulties. The rollout of the online federal marketplace proved challenging. Temporary risk stabilization programs resulted in premium spikes while GAO has raised concerns regarding potential premium tax credit enrollment fraud.
3. Expansion of Health Insurance Exchanges
After years of debate, the Affordable Care Act implemented a significant expansion in health insurance coverage. Quasi-experimental studies indicate this expansion has had positive effects on coverage, access to care and economic outcomes – such as hospital and clinic visits, prescription drug usage and incomes within marketplace subsidized plans.
The Affordable Care Act also required large employers to offer health insurance or face fines, established state-based American Health Benefit Exchanges where individuals could buy coverage directly, and established premium tax credits and cost-sharing reduction subsidies for lower-income families. It made discriminating against persons living with certain medical conditions, like diabetes or congestive heart failure illegal.
4. Expansion of High-Risk Pool
Prior to the Affordable Care Act’s insurance market reforms, nongroup individual buyers faced an unfavorable choice between risk pooling and risk segmentation. Individuals could be denied coverage altogether or offered policies excluding particular health services from coverage altogether or subjected to costly cost-sharing requirements such as high deductibles and coinsurance requirements.
State high-risk pools must strive to achieve an equilibrium between serving medically complex consumers while also keeping costs for payers and beneficiaries to a minimum. Strategies used to reach this goal may include adding federal oversight that enhances State pool management; creating pool mobility where individuals may move into lower risk pools as they improve; or adjusting premiums based on payer assessments.
5. Expansion of Small Business Health Options Program
Many of the Affordable Care Act’s health insurance market reforms apply to small groups offered through SHOP exchanges, including rules prohibiting preexisting condition exclusions and using health status-related rating factors when setting premium rates.
Internal and external factors could have deterred small employers from purchasing coverage through SHOP exchanges in 2014. These may have included requirements under the Affordable Care Act (ACA) to cover essential health benefits (EHBs), which can increase plan costs. Furthermore, many small firms reported using level-funded plans combining some self-funding with stoploss insurance which transferred much of the risk onto insurers.
6. Expansion of Preventive Care
Preventive care such as annual exams, vaccinations and cancer screenings is an integral component of good health and should not only be available to those who can afford it.
Obamacare requires private health insurers to cover preventive services without copays or deductibles; Medicare also now eliminates cost sharing for these essential services, making accessing them simpler and more cost effective for seniors.
The Affordable Care Act prohibits discrimination against certain populations such as LGBT individuals and women based on their sex at birth or gender identity, making this provision of law an integral component of modern law that continues to face legal challenge, such as Braidwood Management Inc v Becerra.
