A balanced look at the historic Act creating Obamacare.
The Patient Protection and Affordable Care Act (known as the Affordable Care Act or “ACA”) was signed into law in March 2010 during the Obama administration. The law took aim at some of the major inefficiencies in American healthcare coverage, particularly the staggering rates of under- and uninsured Americans. The law also prohibited exclusions for pre-existing conditions, including pregnancy, while also eliminated discriminatory practices in premium pricing.
The Act was not without criticism, however – particularly with regard to the anticipated price tag of such an overhaul. Obamacare also struggled to get going in the online marketplace (healthcare.gov) and created some issues at its intersection with religious liberties.
The law has taken some turns since its inception, and the individual mandate – which assessed a penalty on those who did not hold health insurance – was eliminated in 2018. Further, the current Trump administration has introduced a measure known as short-term health insurance, which is not compliant with the ACA but carries a much cheaper price tag.
No law is perfect, but the Affordable Care Act pros and cons expose something we all agree on: healthcare is exceedingly expensive but should be accessible to all.
A Business Look at Obamacare
From a business owner vantage point, Obamacare has its highs and lows. When it was enacted, employers who did not already provide coverage for employees had to majorly readjust their balance sheet. While Obamacare apparently did the job, resulting in just 0.2 percent of American business with 50+ employees not offering health insurance to full-time employees, small businesses struggled at the outset with the employer mandate, a provision assessing penalties on businesses with 50+ full-time employees that did not comply with providing coverage.
A pro, however, is the generous tax incentive and credits offered to businesses to help offset the costs of providing health insurance to employees. There are even credits and incentives available to businesses with fewer than 50 employees who opt to provide coverage to workers despite it not being required.
Another elephant in the room is the hike in premiums that occurred once the law fully took effect. It means that, since insurance companies were now required by law to provide certain medical services, prices for policies increased for everyone – even those in the lowest-risk group (single young males with no dependents). By contrast, companies also can’t drop individuals if they happen to fall ill or experience severe injury, and Obamacare also prohibits companies from initiating rate hikes upon consumers.
Pros and Cons by Demographic
The pros and cons of the Affordable Care Act vary depending on a person’s demographic, such as:
1. Older Americans
Older Americans who benefit from Medicare saw an increase in available services covered under the program, specifically as pertaining to routine doctor visits and preventative care. However, a major con is the reduction in Medicare allocations for home health care (i.e., visiting nurses) – which many older Americans prefer as opposed to leaving their homes for assisted living or long-term care facilities. Also, Medicare deductibles for most older Americans were decreased under the ACA, except for high-earning seniors who experienced an increase instead.
2. Low-Income Americans
The pros far outweigh the cons when it comes to healthcare for low-income Americans under the ACA. First, the Act greatly expanded Medicaid coverage for adults and seniors alike, creating mandatory essential health benefits that must be covered. Further, many states opted to initiate expanded Medicaid coverage, which permits those earning up to 138% of the Federal Poverty Limit (FPL) to access Medicaid for themselves and their dependents.
Unfortunately, not all states opted to expand Medicaid to cover those living just 138% (or less) above FPL, causing many to be unable to afford a self-pay plan through their employer or through the marketplace. Although, those states that did opt to expand coverage did so in order to afford 15 million more Americans the opportunity to access full coverage.
Obamacare exponentially increased the number of services, both preventative and curative, that benefit women’s health. The Affordable Care Act created mandatory essential health benefits that include screenings and testing for all women’s cancers, reproductive counseling and contraception, prenatal care, post-natal care, lactation support and all care relating to childbirth. Many of these services are mandated to be at no cost to the patient.
A Fiorella Insurance Agent can help you choose insurance that’s right for you.
Discussed further below, there exists controversy concerning the mandate to cover contraceptive healthcare in light of religious liberties – which is a con for some employers and those individuals with such convictions.
The Affordable Care Act also created what is known as the marketplace – which allows for private sector insurance carriers to compete for business for those needing a health insurance policy. There is the federal marketplace exchange, found on www.healthcare.gov, where potential enrollees nationwide can shop for coverage. Then, about one half of states have opted to create their own exchanges – while one-half have not. These states that have opted out of the state-executed exchanges have left it to the federal government to administer the marketplace, which has not always gone smoothly. As a result, federal tax dollars have been used to administer the online marketplace in these states, resulting in fees for the insurance providers, and ultimately increased premiums.
Other Pros and Cons
The overwhelming pro to the Affordable Care Act is the provision of comprehensive healthcare coverage to millions of Americans – adults and children alike – who would not otherwise qualify for coverage due to pre-existing conditions or inability to pay. Further, forcing insurance companies to provide minimum essential health benefits has created a competitive marketplace where shoppers can search for the highest level of care at the lowest cost.
Religious liberty concerns remain a con for many conservative Americans, as faith-based business owners have challenged the mandate to provide coverage for certain women’s health services – including contraceptives, treatments known as “abortifacients,” and termination of pregnancy. Litigation is ongoing on these issues and will likely continue until a mutually-acceptable arrangement is met.
When it comes to availability of care, the pros outweigh the cons under the Affordable Care Act. While no law is without flaws – including Obamacare – this legislation was the result of long overdue consideration of healthcare coverage in America.
A Fiorella Insurance broker or agent can help you figure out what information you’ll need, what documents to submit if you need to, and decide which plan is best for you and your family.