The Affordable Care Act (ACA) is a landmark healthcare reform law enacted in the United States by President Obama in 2010. Its primary aim was to improve the quality and affordability of health insurance for all Americans. While the ACA has undergone several modifications and legal challenges over the years, it remains a critical component of the American healthcare system. In this blog, we will explore the key aspects of the Affordable Care Act, its requirements, challenges, and changes.
About the ACA
The ACA implemented the majority of its provisions in 2014, introducing significant changes to the healthcare landscape in the United States. Some key elements that took effect in 2014 include health insurance exchanges, premium subsidies, guaranteed-issue coverage, essential health benefits, and an individual mandate that required all Americans to maintain health insurance.
Between 2014 and 2018, individuals who failed to maintain health insurance coverage faced a penalty imposed by the IRS. However, this penalty was repealed at the end of 2018 through the Tax Cuts and Jobs Act, which was enacted in December 2017. Despite the federal penalty repeal, Massachusetts, DC, New Jersey, California, and Rhode Island continue to enforce their own mandates and penalties for being uninsured.
ACA Highlights
Due to the Affordable Care Act, there are actions insurers are prohibited from doing, such as the following:
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- Terminating coverage, except in cases of fraud or intentional misrepresentation
- Refusing coverage based on pre-existing medical conditions
- Charging older enrollees more than 3x the amount charged to younger ones
- Imposing higher premiums due to health issues
- Providing plans that do not include essential benefits, unless the plan is grandfathered
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Challenges
The Affordable Care Act (ACA) has faced several challenges since its enactment. While the law aimed to improve healthcare access and affordability, its implementation has encountered various obstacles and criticisms. Some of the key challenges of the ACA include the following:
- Political Opposition: The ACA has been a subject of intense political debate and polarization. Its passage and implementation faced resistance from certain political groups, leading to ongoing efforts to repeal or dismantle parts of the law.
- Rising Premiums: Despite the ACA's goal of making health insurance more affordable, some individuals and families experienced significant increases in their premiums. This rise in premiums has been attributed to various factors, including adverse selection and the costs associated with covering essential health benefits.
- Insurance Market Stability: The Act’s implementation led to shifts in the insurance market, with some insurers withdrawing from certain regions or exiting the market altogether. This lack of competition in some areas resulted in limited choices for consumers and potential volatility in premiums.
- Employer Mandate Impact: The ACA's employer mandate, which required certain employers to offer affordable health insurance to their employees, led to concerns among some businesses about increased costs and potential effects on hiring practices.
While the ACA has brought about significant improvements in healthcare access and coverage for millions of Americans, it has also encountered its fair share of challenges and criticisms. As the healthcare landscape continues to evolve, policymakers and stakeholders must work collaboratively to ensure that the ACA fulfills its intended goals of providing accessible and affordable healthcare for all Americans.
4 Recent Changes to the ACA
Understanding recent changes made to the ACA, as well as your plan options, will ensure you make an informed decision.
- Standardized Plan Options for Easier Selection
In 2023, all insurance companies participating in the federal marketplace are required to provide standardized plans with consistent basic features across metal levels (bronze, silver, gold, and platinum). These plans will be available for each service area, plan type, and metal level where non-standardized plans are also offered. The standardized plans will be prominently displayed on the website to streamline the shopping experience. Having access to standardized plans might reduce the need for extensive plan comparison compared to previous years.
- Expanded Healthcare Options for Underserved Areas
This year has brought a new rule addressing essential community providers (ECPs). These providers focus on serving low-income and medically underserved individuals, including community health centers in urban areas, Ryan White HIV/AIDS Program providers, and Indian Health Service facilities.
Previously, qualified health plans were required to contract with at least 20% of the ECPs in their service regions. As of 2023, this requirement will increase to 35%. However, the impact of this change may be limited, given that as of 2021, 80% of federal marketplace plans already met the higher standard. This rule primarily aims to curtail negative practices.
- Enhanced Generosity of Health Plans
The ACA's metal categories – bronze, silver, gold, and platinum – correlate with the percentage of costs you're responsible for. Given that these percentages are challenging to hit precisely, insurance companies have had some flexibility. In other words, a plan could qualify as silver if it covers between 66% and 72% of average costs.
Starting in 2023, insurance companies will have less leeway. Plans within each metal level must fall within plus or minus 2 percentage points of the target percentage. Plans falling short of this benchmark will need to provide better benefits.
- No Denial of Coverage for Outstanding Bills
Previously, an insurance company could deny coverage if you had unpaid monthly bills. These dues would have to be settled along with your first bill for the new plan year.
This practice will no longer be permitted, although overdue bills could still be referred to collection agencies. The underlying principle is that denying coverage contradicts the essence of the ACA – ensuring guaranteed health benefits. This change provides you with an additional layer of protection that was absent before.
In a landscape of shifting policies and evolving healthcare needs, these changes collectively reflect the ongoing effort to improve the ACA and enhance its ability to provide accessible and comprehensive healthcare coverage for all individuals.
Insurance Options
Researching different insurance plans and your expenses ensures you’re making a well-informed decision for yourself and your family. A great, cost-effective option is adding a supplemental plan to your current insurance plan. Supplemental plans help pay for out-of-pocket expenses not covered by primary plans. These costs could include co-pays, ER visits, cost shares, and more!
Supplemental Insurance with GEA
At GEA, we are committed to alleviating the financial stress on our members and their loved ones. That’s why we offer CHAMPVA Supplement Insurance plans exclusively for CHAMPVA members. Our CHAMPVA Supplement Insurance Plan effectively minimizes or even eliminates expenses, such as ER visits, co-pays, and beyond! Are you interested in learning more about our CHAMPVA Supplement Plan? Speak to one of our specialists today!
