One of the largest holdovers of Obama’s legacy is Obamacare. The goal: to increase health insurance quality and affordability while also lowering the number of Americans without health insurance. Start a search today to learn more about Obamacare.
Barrack Obama proved that inspiration, intelligence, and grace can overcome the largest obstacles. I mean, being the first African-American president is nothing to shake a stick at. His landmark healthcare policy has pros and cons. Let’s dive in!
Get It or Pay
The Affordable Care Act (referred to from here on in as the ACA), requires all uninsured Americans to get and keep medical insurance. It’s referred to as the Individual Mandate.
Disobeying the Individual Mandate results in a mandatory opt-out fee called the Individual Shared Responsibility Payment. But you can opt out of that too, provided you qualify for one of these exemptions.
One Giant Leap
The Obamacare statute was the most significant revamp of the American healthcare system since the invention of Medicare and Medicaid back in 1965.
For the uninitiated, Medicare is a payroll-taxed health care service that provides seniors 65 years of age and older with health insurance. And Medicaid was designed to provide low-income Americans with government-managed financial aid to help cover medical expenses.
Medicaid on Steroids
When the ACA became law, it dramatically expanded the eligibility for and Federal funding of Medicaid in most states. As of 2010, US citizens and legal residents with income up to 138% of the poverty level now qualify for Medicaid. That works out to about $16,243 US per person or $33,465 for a family of four.
It’s not exactly that simple, though. Your home state had to have agreed to the Medicaid expansion. States that have currently opted out of the Medicaid expansion include Texas, Florida, North and South Carolina, Virginia and more.
Before the ACA, Health Insurance companies could charge you a higher premium based on your gender and your current health status. Traditionally, women have always been required to pay a higher premium than men for similar coverage. Same goes for individuals with pre-existing conditions.
But in 2014, Obamacare levelled the playing field… sort of. You may still be charged a higher premium if you smoke cigarettes, are part of a large family, are older, or live in an area with less available medical coverage. But the days of gender discrimination or being turned away due to your pre-existing condition are largely over.
Opting in, opting out, making changes to your coverage and educating yourself on the ins and outs of the ACA can all be conveniently accomplished at HealthCare.gov. But it wasn’t always sunshine and rainbows.
The website’s launch came with a whole host or serious technological problems. And maintaining it has come with quite a hefty price-tag.
Snooze = Lose
You can only purchase ACA-qualified medical insurance during the open enrollment period. Typically, that period stretches from November 1st of the current year to January 31st of the following year.
It’s a pretty large window of opportunity, but missing it could prove costly. If you don’t enroll in time, you may be subject to the annual opt-out fee in addition to your health insurance premium.
As of 2010, roughly 30% of Americans between the ages of 19 and 29 went uninsured. That’s a huge problem, and one that the ACA set out to solve. Today, young adults are now permitted to remain covered on their parents’ health insurance plans until the age of 26. And nearly 3 million Americans have done just that.
Couple that with an ever-growing list of subsidies and low-income protections, the ACA has provided young Americans with more affordable health insurance options than ever before.
The 80/20 Rule
The 80/20 rule is another landmark initiative of the ACA designed to protect the consumer from unfair premium increases.
Under the 80/20 rule, insurance companies are now required to spend a minimum of 80% of the money they take in from consumers directly on health care and quality improvements. It ensures that your premium is determined based more on your healthcare coverage than on your insurance company’s bottom line.
Because the enrollment process operates on an annual basis, you’ll most likely be contractually obligated to keep your selected plan until the next open enrollment period. All the more reason to take your time, explore your options and select the one that works best for you.
And remember, there’s no shame in asking for help.
Healthcare plans can vary quite dramatically from state to state and company to company. But there are a few things that you can always count on. The ACA contains a list of Ten Essential Health Benefits that all Health Insurance plans must provide coverage for. Those benefits include Ambulatory patient services, emergency services, prescription drugs, maternity and newborn care and more.
Now, it wouldn’t be a comprehensive overview if we didn’t take a look at the Pros and Cons of the ACA. I mean, it’s controversial for a reason. So, let’s lean in and take a closer look at the raging Obamacare debate.
Pro: More Americans Are Covered
Enrollment numbers spurred by the ACA are remarkable. There’s a much more comprehensive rundown of enrollment figures available here, but there are some notable standouts.
Roughly 20 million Americans have received healthcare coverage though either the ACA Marketplace, the expansion of Medicaid, or the expansion of young adult coverage. Also, as it stands, the uninsured rate sis at 11.9%, the lowest in the history of the country. Compare that to the 15.7%, pre-Obamacare uninsured rate.
Con: Higher Premiums
Forcing insurance companies to cover the masses hasn’t been free and much of the bill has been forced onto Americans who already had health insurance to begin with. The number isn’t small, either.
When comparing pre-ACA premiums with today’s rates, Forbes suggests that consumers have faced an increase of over 50%. It’ll take a lot more than a spoonful of sugar to make that medicine go down.
Pro: Health Insurance Is More Affordable (for Many People)
The ACA expanded coverage countrywide, but it also forced a few significant operational changes on the Health Insurance business model as well.
The 80/20 rule has sparked innovation, consumers have more affordable coverage options and the ACA prevents insurers from making unreasonable rate increases.
Con: Tax Increases
The ACA is largely funded through a slew of new tax initiatives including higher taxes on medical equipment and pharmaceutical sales, and increased income taxes for the wealthy.
Also, some savings from the Medicare budget were reassigned to help fund ACA initiatives.
Pro: Lower Prescription Drug Costs
The ACA delivered on its promise to lower the cost of prescription drugs by footing the bill for a large number of them.
Again, there’s a comprehensive list of prescription and generic drugs available here, but the important thing to note is that Obamacare has saved consumers over $15 billion within the first 5 years.
Con: Businesses Are Cutting Hours
Under the ACA, businesses with 50 or more full-time employees are required to offer insurance or make payments to cover healthcare expenses for their employees. As such, many businesses are simply cutting hours, or relying on part-time employees to replace full-time positions.
Obamacare is seen by many to be anti-job.
Trump vs. Obamacare
Donald Trump ran his campaign on the promise that, on day one of his presidency, he’ll “ask Congress to immediately deliver a full repeal of Obamacare.”
In addition, Trump insisted that consumers should be able to cross state lines when shopping for healthcare, that health care providers require price transparency. He also intended to hand over Medicaid management to the states and allow consumers to deduct their health insurance premiums from their Federal income tax.