Health Insurance Basics
Disclosure: Each Person and Insurance policy is unique and the following is general information, please contact us for more specifics related to your policy and situation.
Health Insurance Basics
Disclosure: Each Person and Insurance policy is unique and the following is general information, please contact us for more specifics related to your policy and situation
The Patient Protection and Affordable Care Act (ACA), a piece of federal legislation commonly referred to as "Obamacare," made sweeping changes to how health insurance is procured and paid for. Signed into law on 2010, ACA requires individuals who don't receive health insurance benefits through their employers to purchase coverage or pay a penalty. The law also puts certain limits on what insurers may or may not do with respect to eligibility and coverage. The ACA has numerous, often-complex provisions that phase in over time (through 2022).
This article provides a concise overview of Obamacare, how it affects you, and what you need to do to take advantage of its benefits.
The Affordable Care Act seeks to lower health care costs by making sure more people participate and receive preventive care, while prohibiting some of the insurance industry's more restrictive practices. The following is a list of key ACA provisions (with the implementation date in parentheses, where applicable):
- Dependants may be covered by their parents' insurance plans until they turn 26.
- Insurers may not cancel policies when policy holders become sick.
- State health insurance exchanges (the "Health Insurance Marketplace") allow businesses and individuals to compare plans and enroll for coverage.
- Insurers may not place a lifetime monetary limit on hospital stays or other benefits deemed "essential" in new policies.
- Insurers may not deny coverage to individuals for pre-existing conditions, and must offer the same premiums within the same age and geographical group regardless of gender and pre-existing conditions, except tobacco use.
- Individual mandate takes effect, requiring all individuals (with some limited exceptions) to carry health insurance or pay a tax penalty. Subsidies will help low-income people comply with this mandate.
- Medicaid eligibility expands to include those earning 133 percent of the official poverty level, including adults without dependants, in participating states.
- Subsidies (in the form of refundable tax credits) available on the state health insurance exchanges for individuals with a household income up to 400 percent of the official poverty level.
- Minimum standards for health insurance policies enforced.
- Employers may not require employees to wait more than 90 days for health insurance eligibility.
- Tax credits offered to small businesses (25 or fewer full-time employees, defined as 30 hours per week) for compliance with ACA.
- Larger employers (more than 50 full-time employees) will be charged a $2,000 penalty per full-time employee that lacks health coverage.