Before the Affordable Care Act (ACA) was enacted, many Americans had no insurance or they had coverage only when they needed it, like after an accident or illness. The ACA changed this by expanding Medicaid and creating new health insurance exchange markets where people could buy private insurance with financial help from the federal government for those who couldn’t afford it. It also introduced new concepts that would make insurance more affordable and accessible, such as guaranteed issue and community rating. These changes combined have helped drive down the number of uninsured in the U.S. to the lowest level ever recorded.
Some critics of the ACA say that it hasn’t accomplished its goals because premiums are too high. In response, a number of countervailing measures have been implemented that encourage healthy as well as sick people to sign up for coverage, and reduce the risk of big spikes in insurance prices by spreading out health risks among all enrollees. These include:
Putting Information for Consumers Online
The ACA makes it easier to compare and choose health insurance coverage options by placing the information online in one place. It also prohibits insurance companies from denying or charging higher premiums to people who have preexisting conditions, and it caps annual and lifetime limits for benefits. In addition, it requires most health plans to cover preventive services at no charge to patients.
Making Health Insurance More Affordable
The law includes tax credits that can be used to pay for marketplace insurance, and to assist with Medicare cost-sharing. These benefits help lower the cost of premiums and copays/coinsurance for people with incomes below 400% of the poverty line. It also eliminates the so-called “subsidy cliff” that prevented some middle-income people from purchasing affordable insurance through the marketplace, and extends eligibility for ACA marketplace subsidies to help those with incomes between 100 and 400% of poverty who did not receive financial assistance from their employers to purchase coverage in the exchanges.
It has made it illegal for large employers to discriminate against workers who don’t want employer-provided health insurance, and has reformed Medicare to allow private plans to compete with traditional Medicare by offering benefits such as lower copays and deductibles, and more flexibility in the choices of providers and plan participants. It has also expanded the pool of people eligible to receive Medicare Advantage by adding younger, healthier enrollees.
Some of the most significant changes under the ACA are still to come, including a gradual reduction in Medicare’s growth rate, and the creation of Accountable Care Organizations to provide higher quality, more integrated healthcare. Despite attempts by some to repeal or fundamentally change the ACA, it continues to enjoy broad support across the political spectrum.