BDO.org – We’ve been hearing about Obamacare for over two years now. The Supreme Court’s recent decision to uphold healthcare mandate has put the Affordable Care Act back in the mainstream, but many people are still very confused about what it’s about, and what it really means for them.
So, how does all of this really affect you?
The Patient Protection and Affordable Care Act, otherwise known as “Obamacare” or “the Health Care Law” was signed into law on March 23, 2010. The law includes more than 90 changes to existing healthcare policy, and while a few of those changes took affect immediately, most of the larger changes will not happen until 2014.
Many medical organizations, including the National Medical Association, is applauding the Supreme Court’s decision to uphold the law.
“The ACA is working,” says Dr. Cecil Bright, NMA President. “More seniors can now afford their meds. Young people can stay on their parents’ health plans until age 26. Insurers no longer deny coverage because of pre-existing conditions, or drop people because they get sick. We are doing a better job of coordinating care, and we now have better prospects for preventing chronic disease. This is our best opportunity in a generation to overhaul our health care system. We look forward to working with the States and the Administration to ensure that the reforms are fully implemented.”
What the law means for: The uninsured
The decision leaves in place the so-called individual mandate — the requirement on Americans to have or buy health insurance beginning in 2014 or face a penalty — although many are exempt from that provision.
In 2014, the penalty will be $285 per family or 1% of income, whichever is greater. By 2016, it goes up to $2,085 per family or 2.5% of income.
What the law means for: The insured
Because the requirement remains for people to have or buy insurance, the revenue stream designed to help pay for the law remains in place. So insured Americans may be avoiding a spike in premiums that could have resulted if the high court had tossed out the individual mandate but left other requirements on insurers in place.
What the law means for: People with Medicare
The new law protects guaranteed Medicare benefits. It also improves and expands those benefits, such as lower out-of-pocket drug costs and free Medicare-covered preventative care benefits. Yet another benefit is improved access to primary care doctors. In addition, Medicare recipients will keep getting discounts on drugs to close a gap in coverage known as the “doughnut hole.”
What the law means for: Young adults
Millions of young adults up to age 26 who have gained health insurance due to the law will be able to keep it. The law requires insurers to cover the children of those they insure up to age 26. About 2.5 million young adults from age 19 to 25 obtained health coverage as a result of the Affordable Care Act, according to the U.S. Department of Health and Human Services.
Two of the nation’s largest insurers, United Healthcare and Humana, recently announced they would voluntarily maintain some aspects of health care reform, including coverage of adult dependents up to age 26, even if the law was scrapped.
What the law means for: People with pre-existing conditions
Since the law remains in place, the requirement that insurers cover people with pre-existing medical conditions remains active.
The law also established that children under the age of 19 could no longer have limited benefits or be denied benefits because they had a pre-existing condition.
Starting in 2014, the law makes it illegal for any health insurance plan to use pre-existing conditions to exclude, limit or set unrealistic rates on coverage. It also established national high-risk pools that people with such conditions could join sooner to get health insurance.
More than 13 million American non-elderly adults have been denied insurance specifically because of their medical conditions, according to the Commonwealth Fund. The Kaiser Family Foundation says 21% of people who apply for health insurance on their own get turned down, are charged a higher price, or offered a plan that excludes coverage for their pre-existing condition.
What the law means for: All taxpayers
No matter what the Supreme Court had decided, it would have been a mixed bag for all Americans when it comes to federal spending. There is still much discussion about what impact the health care law will have on the country over the long term.
The federal government is set to spend more than $1 trillion over the next decade to subsidize coverage and expand eligibility for Medicaid. The nonpartisan Congressional Budget Office estimated that the law could reduce deficits modestly in the first 10 years and then much more significantly in the second decade.
The CBO said a repeal of the mandate could reduce deficits by $282 billion over 10 years, because the government would be subsidizing insurance for fewer people. But the nation faces costs in various ways for having people who are uninsured. The Urban Institute’s Health Policy Center has estimated that without a mandate, 40 million Americans would remain uninsured.
Meanwhile, the Flexible Spending Accounts that millions of Americans use to save money tax-free for medical expenses will be sliced under the law. FSAs often allow people to put aside up to $5,000 pre-tax; as of 2013, they were to face an annual limit of $2,500.
What the law means for: All Americans
The massive health care law requires doctors to report goodies they get from medical supply companies; demands more breastfeeding rooms; requires all chain restaurants to list calories under every menu item, and includes other provisions, which now remain in place.
What the law means for: Doctors and other health care providers
Health care providers have already begun making changes based on the 2010 law, and in preparation for what will go into effect in 2014.
In general, medical groups have disagreed over the health care law. In the short term, doctors avoid “chaos” that may have resulted from the law suddenly being dropped or changed, according to Bob Doherty, senior vice president of governmental affairs at the American College of Physicians.