The Affordable Care Act of 2010 caused quite a bit of controversy. Several states filed lawsuits to try and get some or all of the act repealed through the Supreme Court. The nation's highest court found that the law was (for the most part) constitutional, and those parts of the law that are not already in effect will go into effect by 2014 at the latest. Some of these provisions will be very beneficial to consumers, others will be quite controversial. It also remains to be seen what impact the ACA will have on health insurance premiums.
Those who are under age 26 and do not have insurance can get it through their parents' policy. Previous to the passage of Obamacare, only those who were still students could remain on their parents insurance. This is just one of the major shifts in the delivery of health insurance.
Many people have trouble getting affordable health insurance because of pre-existing conditions. Prior to the Affordable Care Act, insurance companies could deny coverage to individuals who had these conditions. If they did offer insurance for these conditions, premiums were usually too high for most people to afford. The ACA prohibits insurance companies from denying coverage to those with pre-existing conditions; this is called “guaranteed issue”. Another change that is intended to benefit consumers is the new requirement that insurance companies put your premium dollars towards healthcare for you. Previously, companies had no limit on the amount they had to spend on healthcare. Under Obamacare, insurers are required to spend at least 80 percent of the premium dollars they receive on actual healthcare.
The Affordable Care Act requires that just about everyone in the United States have health insurance. Those with lower incomes – and up to 400% of the federal poverty level (about $44,000 for an individual) scale will have their premiums subsidized if they purchase coverage through the exchanges. Some will remain on Medicaid for their care, and many states (but not all) are expected to expand Medicaid eligibility. The ACA’s architects hope that the penalties, combined with these subsidies, will make it more likely that employers will offer insurance to their employees, but it can be assumed that different employers will react – and adapt – in different ways.
The U.S. Supreme Court upheld the right of the ability of the federal government to collect a tax penalty from those Americans that don’t maintain adequate health care coverage. This is one of the most controversial and hotly debated portions of the law, and is sure to be a big topic when the penalty begins in 2014-2015. In the first year, a person making $50,000 per year would be assessed a $500 penalty (1% of their income) for failing to maintain such a policy. Not all insurance products will satisfy the individual mandate, and you should ask your agent whether or not your policy is compliant with this requirement. Nevertheless, it is expected that many Americans will continue to choose the most affordable coverage option even if they have to pay a tax penalty for doing so.
