On March 23, 2010, a historic piece of legislation was signed into law by President Barack Obama expanding access to affordable healthcare coverage for Americans via the creation of a health insurance marketplace, unique to each state. Known formally as the Patient Protection and Affordable Care Act, Obamacare soon garnered overnight attention for its focus on prevention, wellness, and reasonable costs.
Federal Poverty Level Establishes Subsidy Level
While healthcare expenses continue to plague many American homes, access to health insurance coverage has greatly increased for those who may be under-insured or completely uninsured, especially for those who live below the federal poverty level. With the enactment of Obamacare, many have been able to access much-needed procedures and other health care services without facing bankruptcy due to unexpected out-of-pocket costs, all while protecting against discrimination and refusal of coverage for pre-existing conditions.
If you’ve ever wondered what Obamacare actually is and how it can help with healthcare costs, the following provides an overview of this historic law and its implications for Americans of all ages.
Obamacare was enacted during the eight-year tenure of former President Obama with the assistance of federal government lawmakers. The bill came about in light of an increasing need for healthcare reform in America, as well as consistently rising healthcare costs and instances of medical debt-related bankruptcies.
Obamacare created a timeline of changes that employers had to implement in stages, including elimination of pre-existing condition exclusions and extension of the coverage age for young adults under their parents’ insurance plans. Following a challenge in federal court, the law was upheld by the U.S. Supreme Court in June 2012, and the first open enrollment period began May 1, 2014.
Highlights of Obamacare Coverage
One of the top questions concerning Obamacare is what the most impactful changes are, and how the law affects individuals and families seeking to minimize healthcare costs. The following are some of the key highlights of the act:
- Expansion of Coverage
- Emphasis on Prevention
- Improving Quality
Pre-existing conditions can be costly, and for that reason, many health insurance carriers refused to offer health insurance coverage to anyone with certain diagnoses. Under Obamacare, those with pre-existing conditions were initially able to obtain Pre-Existing Condition Insurance Plans (PCIPs), which still came with a hefty price tag. By 2014, however, this distinction was eliminated and nearly all Affordable Health Act compliant healthcare plans were required to accept children and adults with a pre-existing health issue.
Obamacare also worked to do away with discriminatory practices by insurance providers, including discriminating based on gender or health status. For instance, women could not be charged more for a policy due to their potential need for pregnancy care. Also, Obamacare built on the protections afforded to those suffering from mental health and/or substance abuse issues by requiring coverage for treatment of these conditions.
2. Expansion of Coverage
Historically, employers could decline to provide coverage for employees – or exclude certain categories of applicants as discussed above. Under the federal government’s Obamacare plan, many businesses receive tax credits for offering healthcare – but are also required to do so or face hefty fines.
Further, individuals are also mandated under Obamacare to find an Affordable Care Act compliant health insurance plan from one of the health insurance exchanges or pay a penalty on their tax return if they opt out. For individuals, the health insurance marketplace exchange was created to allow folks to shop around and find a plan that makes the most sense. Also, Obamacare prohibits dropping anyone because they reached a lifetime limit or are suffering from a chronic condition.
3. Emphasis on Prevention
Obamacare views healthcare prevention as an investment with a return of lower overall health costs for all. Preventative screenings and wellness examinations are generally free or low-cost for the patient, and Obamacare includes a list of ten types of patient services that must be included in all plans, such as:
- Ambulatory services: Generally known as “outpatient” services – those that do not require hospital admission.
- Emergency treatment
- Obstetrics: Including pregnancy and prenatal care, childbirth and antepartum care (including breastfeeding)
- Behavioral Health: Mental health, psychotherapy and substance use treatment
- Prescription drug coverage
- Rehabilitation services and devices: This includes services and therapies designed to help people with injuries, disabilities or chronic conditions recover mental or physical skills, as well as gain these skills (known as habilitative or chronic disease management).
- Laboratory testing services
- Pediatric wellness: This coverage must also include dental and vision care for children
- Preventative care: Routine physicals and health screening, as well as management of chronic conditions
These services, known as “essential healthcare” are considered minimum requirements to provide essential health benefits, and a health insurer may expand on these or offer additional coverage in certain areas.
4. Improving Quality
Perhaps one of the lesser-known components of Obamacare, the act contains a number of provisions designed to enhance research and analysis of medical conditions and issues impacting Americans today. For instance, Obamacare opened up funding streams to research pharmacological treatments for chronic illnesses, as well as studies of the interplay between demographics and health disparities. Obamacare also contained line items pertaining to enhancement of medical technology, reducing medical errors and streamlining communication between Medicare and Medicaid for those patients that qualify for both programs.
Obamacare & Healthcare Delivery
The inception of Obamacare paved the way for changes in healthcare delivery and increased the use of technology to streamline the doctor-patient relationship. One major change nationwide has been the influx of “urgent care” centers that allow patients with non-life-threatening health issues to receive immediate walk-in care, often during non-traditional business hours. For patients willing to forgo the traditional long-term primary care provider relationship, this can be a welcome affordable change for busy families.
Other updates to healthcare delivery include the growing notion of “telehealth” allowing doctors and patients to communicate via video chat. Telehealth is touted as not only more convenient – especially for stressful but routine pediatric appointments (e.g. ear infections) – but increasingly more economical with much lower costs than a traditional office visit.
At Fiorella Insurance, we are dedicated to the notion that all families deserve an affordable and holistic health insurance package. To learn more, give our office a call today!