The Affordable Care Act (ACA), colloquially known as Obamacare, has had a significant impact on the health insurance landscape in the United States since its implementation in 2010. However, it’s a complex piece of legislation with numerous components, many of which are not well-understood by the average person. Here are ten things you need to know about the ACA but probably don’t.
- Comprehensive Coverage: ACA-compliant plans are required to cover ten essential health benefits, including outpatient care, emergency services, hospitalization, maternity and newborn care, mental health services, prescription drugs, rehabilitative services, lab services, preventive care, and pediatric services.
- Pre-existing Condition Coverage: One of the most important aspects of the ACA is that it prohibits insurance companies from denying coverage or charging more to individuals with pre-existing conditions. This was not the case before the ACA.
- No Annual or Lifetime Limits: The ACA also removed annual and lifetime dollar limits for essential health benefits. This means that insurers cannot cap the amount they’ll pay for your essential health benefits in a year or over your lifetime.
- Subsidies for Low- and Middle-Income Americans: The ACA provides subsidies to lower the cost of health insurance for eligible individuals and families. These subsidies, known as premium tax credits, are available to those with incomes between 100% and 400% of the federal poverty level.
- Medicaid Expansion: The ACA allowed states to expand Medicaid to cover all low-income adults up to 138% of the federal poverty level. However, not all states have chosen to expand Medicaid.
- Individual Mandate (Now Repealed): The ACA initially included an individual mandate, which required most people to have health insurance or pay a penalty. However, this penalty was eliminated at the federal level in 2019. Some states have their own individual mandates, though.
- Marketplaces for Buying Insurance: The ACA established health insurance marketplaces, also known as exchanges, where individuals can compare and purchase insurance plans. These can be state-run, federally facilitated, or a partnership between the state and federal government.
- Young Adults Can Stay on Parent’s Plan: Thanks to the ACA, young adults can stay on their parent’s health insurance plan until they turn 26, even if they’re married, not living with their parents, or financially independent.
- Preventive Care at No Cost: The ACA requires insurance plans to cover preventive services, such as vaccinations and certain screenings, without charging a copayment or coinsurance, even if you haven’t met your yearly deductible.
- Rate Review and the 80/20 Rule: The ACA requires insurers to justify any rate increase of 10% or more before raising premiums. It also mandates that at least 80% (for individual and small group insurers) or 85% (for large group insurers) of premium dollars be spent on healthcare and quality improvement.
Navigating health insurance can be daunting, but an experienced insurance professional like the ones at Vandergrift Insurance Group can help you understand the ins and outs of the ACA and pick the perfect plan. Remember, you don’t pay anything extra for our services, and we’re here to make the process of finding affordable, quality health insurance as simple as possible.
