Obamacare: 5 Things You Need to Know

02 Aug

The Patient Protection and Affordable Care Act, also known as Obamacare is one of the most discussed topics of healthcare policy. Not sure what the law does? Below are 5 key provisions of the law.

#1: The Individual Mandate- The individual mandate is one of the most controversial parts of the Affordable Care Act. It requires all individuals to purchase health insurance coverage. This can be done through many ways: by qualifying for Medicare or Medicaid, purchasing insurance through your employer, or under the Health Insurance Exchange.

#2: The Health Insurance Exchange- The health insurance exchange is marketplace for individuals who don’t receive insurance from their employer to buy into coverage. In addition, the government provides a federal subsidy to those with low and middle income levels to keep coverage affordable.

#3: Pre-Existing Conditions- The ACA effectively bans insurers from denying coverage to those with pre-existing conditions such as cancer or heart disease. Although this is widely seen as the most popular part of the law, it is also one of the most costly. Those with pre-existing conditions often use the most health services, making them quite expensive to insure.

#4: Essential Health Benefits- This portion of the law requires all plans sold in the United States to cover certain healthcare benefits including emergency care, maternity care, mental health, and rehabilitation.

#5: Community Rating Pricing- Prior to the ACA, it was common for insurers to determine insurance rates based on medical history and past use of services. This is no longer the case. Obamacare requires insurers to use a regulated system called community rating to determine premiums. This system is widely based on where you live and your age.

Other Key Provisions

  • Extension of coverage young adults until age 26
  • Mandated coverage of preventative health services
  • Elimination of lifetime limits

Hope that helps!

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