On March 23, 2010, President Obama signed the Affordable Care Act (ACA) into law. The ACA takes our health care out of the hands of insurers by changing the rules to prohibit discrimination against people who are sick, expanding access to health coverage, and putting in place new protections for people who have health insurance. The law will be phased in gradually with most of the coverage expansion taking place in 2014.
HCAN fought for passage of the health law and continues to battle insurers and political opponents to make sure the law is successfully implemented. Members of Congress who voted for reform had to stand up to insurance companies and more than $100 million worth of misleading ads, an army of 1,700 industry lobbyists and satchels of campaign cash. It’s time to move beyond political games and fully realize the promise of reform – quality, affordable health care for all.
What the Health Care Law Means to You
The Affordable Care Act (ACA) puts in place comprehensive consumer protections and insurance market reforms that ensure quality, affordable health care for all Americans. Here are some examples of what the law has already achieved and what it will accomplish as more provisions take effect:
- Stops abusive practices of big insurance companies, including denying coverage for pre-existing conditions, charging women more than men for the same coverage, and refusing to pay for the health care you need when you make a minor application error.
- Gives you the peace of mind of knowing you’ll have good coverage you can afford, even if you lose your job, start a small business or retire early.
- Will provide tens of millions of Americans the same coverage choices as members of Congress.
- Makes health coverage more affordable for small businesses and seniors on Medicare.
Millions of people are already benefiting from the law:
- Insurance companies are not able to deny children coverage because of pre-existing conditions or cancel coverage because a person has been treated in the past. According to insurers’ definitions, approximately 24% of children have some sort of pre-existing medical condition.
- Prescription drug costs have been reduced for millions of seniors on Medicare who fall into the donut hole. Nearly 4 million beneficiaries received a $250 check to help with drug costs in the ACA’s first year, and more than 2.2 million Medicare beneficiaries saved more than $1.2 billion on prescriptions in the second year – an average savings of $550 per person.
- Children will be able to stay on their parent’s health coverage until age 26. Before health reform, about 30% of young adults between 19 and 29 were uninsured. Approximately 2.5 million additional young adults gained insurance in 2011 compared to a year earlier.
- Small businesses may get a 35% tax credit to help pay for their employees’ health insurance coverage. More than 4 million small businesses are eligible for this tax credit.
- Insurance companies must spend at least 80% of premium dollars on health care services or quality improvements rather than administrative costs – 85% for large health plans. Insurers that fall short of those thresholds must refund the difference to consumers and businesses. This provision may deliver consumers as much as $2 billion in rebates from insurers that don’t meet the minimum standard.
- Health insurers must justify to state or federal regulators premium rate increases exceeding 10%. Rate review helps to lower the cost of coverage for people and employers.
- Insurers must cover preventive care with no copay or co-insurance.
Under the ACA, individuals have the option to keep your current plan, whether it’s through your employer or purchased individually. Existing health insurance coverage is protected through a “grandfather” provision, but plans will need to come into compliance with consumer protections described above over time.
While the majority of American’s obtain health insurance through employer-sponsored health insurance, people who do not have health coverage through their employers, individuals who are not happy with their coverage, and small businesses who can’t afford coverage today will be able to choose among health insurance plans sold in state health insurance exchanges. The exchanges will be transparent and competitive insurance marketplaces where individuals and small businesses can shop around at four different levels of coverage and buy affordable and qualified health benefit plans, with a government subsidy if eligible.
When the law is fully implemented in 2014:
- Health insurance exchanges will give millions of people a new, affordable option for purchasing coverage.
- Middle-class families with incomes up to 400% of the federal poverty level ($92,000 for a family of 4) will be eligible to receive premium tax credits on a sliding scale basis to make insurance affordable through the health insurance exchange. Credits will also be available to help small businesses purchase insurance.
- Medicaid will be expanded so impoverished adults will have access to coverage without today’s complex state rules.
- Insurance companies may no longer deny coverage to anyone because of pre-existing conditions.