What Is Obamacare?
How does Obamacare Work?
Under Obamacare, insurance companies are required to offer health care to all Americans. The act made it illegal for insurers to reject individuals based on pre-existing conditions or their current health status. The main reason Obamacare plans are affordable is that the federal government siphons money every month to major insurance companies. This money (which was formerly called cost-sharing-reduction payments) collectively reduce insurance premiums for millions of Americans, therefore making health care plans affordable.
Affordable Care Act Subsidies for Individuals and Companies
Obamacare Insurance Varieties
Health insurance is not a one size fits all type of business. Due to this, the marketplace offers insurance coverage from several different companies. To find the plan that is right for you and your family, it is necessary for you to evaluate your own health care needs, as well as medications, conditions, etc., as well as consider the premium amounts to see if they fit into your budget. Look at the quality as far as customer service as well. Do a search for reviews and then put in the name(s) of the companies that you are considering to see how they stack up against each other. All of these considerations should be taken to allow you to find the proper coverage for you and your family.
Individuals who want to purchase an Obamacare plan can only do so during the Open Enrollment Period. For 2018, Open Enrollment begins on November 1, 2017 and ends on December 15, 2017. This means citizens have exactly 45 days to properly shop and compare prices on the marketplace.
How to sign up for Obamacare
This depends entirely on your state, as some have created a state-based marketplace, while the majority rely on the federally facilitated one. In regards to the latter, most states use HealthCare.gov.
Starting this last tax year, if you do not purchase insurance, whether from your employer, on your own or through the Affordable Care Act website, you are penalized. This penalty cannot exceed 1% of your household income or $95 per person over 18 and $47.50 for each child under 18. These amounts are for the 2014 Tax filings only, as of 2015, these penalties will increase to 2% or $325 per person and $162.50 per child under 18. They will continue to increase for a couple of years to try to push people into getting coverage. It is important to also note that companies will be penalized for not offering insurance to their employees beginning in 2015 if they have more than 50 full-time employees. They must offer it to 70% of their employees, as well as their dependents, in 2015, 95% by 2016, or pay a fee. If employers do not offer affordable insurance to their employees, they are to pay an Employer Shared Responsibility payment per employee, which can quickly add up, depending on the number of employees that they have.
Obamacare Insurance Requirements
If you currently have an insurance plan via your employer, it has to meet certain insurance requirements that have been laid out in the Affordable Care Act. Here are the main requirements: Coverage cannot be denied due to pre-existing conditions, while premium variations can only be due to age, tobacco use, family size, and geography. This removes the variations due to pre-existing conditions, health status, claims history, etc Guaranteed Renewability of Coverage means that an insurance company cannot refuse to renew coverage due to illness or pre-existing condition Catastrophic Plan changes include making sure they have lower premiums, protecting against high-pocket costs, and covering preventative services without cost-sharing. Obamacare and the Affordable Care Act have many benefits for those who do not currently have insurance, work at a company that does not offer it, or simply cannot afford it. When you go to the health insurance marketplace, you will find that there are many different options for you and your family. By evaluating each of the plans and the companies that issue them, you can ensure that you make the right choice for you and your family.
The Obama Administration
Leading up to the 2008 Presidential election, health insurance was widely debated by both Republican and Democratic candidates who spoke openly about reforming the current system through various means. For example, Presidential candidate John McCain proposed a series of tax cuts to those who purchased a plan through the individual market, which was hypothesized to reduce the number of uninsured individuals in the country.
Once Barack Obama won the election, he tasked his administration to come up with a solution that would make health care more affordable and accessible. This would ultimately lead to the creation of the Affordable Care Act, which was signed into effect in 2010. Often times you’ll hear the word Obamacare being thrown around, which is synonymous with the ACA.
The Affordable Care Act has continuously faced a lot of opposition. The Republican Party voiced their discontent towards the bill and created various legal battles in an attempt to nullify the effects.
The main argument surrounding the ACA is that it would increase the country’s deficit and raise the price of new insurance standards, according to the Kaiser Family Foundation. In 2013, a fierce Congressional debate raged over this bill, which resulted in a stalemate and forced a temporary government shutdown for 13 days. The reason the shutdown occurred was that the Republicans refused to raise the debt ceiling unless Obama made concessions to the bill.
President Donald Trump has campaigned heavily on the promise to “repeal and replace” the bill, although since he’s assumed office in January 2017, he and the Republican Party have failed to do so. This is mainly because all of the replacement proposals were deemed too harsh by politicians, and would be devastating for the American people.
Health Insurance Premiums
A premium refers to the monthly cost of your health insurance. For individuals with job-based insurance, their premium is typically deducted from their paycheck. Those enrolled in an Obamacare plan have to pay a monthly premium directly out-of-pocket. Premiums differ in price depending on your location and the type of plan you’ve selected.
Different Types of Plans
There are four different types of health insurance plans under the Affordable Care Act. There are the Bronze, Silver, Gold and Platinum plans, which all offer the core benefits that adhere to the ACA. The plans differ in price and coverage with the Bronze plan being the most affordable, ranging to the platinum plan being the most expensive but provides more coverage.
Cost-Sharing Reduction (CSR) Payments
Recently, the White House announced it would halt cost-sharing reduction payments (also known as CSRs). This refers to federal funding that’s siphoned to insurance companies across the nation, which effectively reduce the cost of premiums for Americans who purchase an Obamacare plan.
This means insurance premiums are likely to increase, as insurers will no longer receive federal funding. Certain states like California have already incorporated price increases into their premiums to compensate for the fact that they’re going to be losing money in the long run.
The Future of Obamacare
It’s evident the American health care system is still undergoing a dramatic transformation. It’s hard to predict whether the Affordable Care Act will stand the test of time or be repealed in Congress by the ruling Republican Party. Instability aside, HealthQuoteInfo will continue to serve the American people and will answer all health insurance-related questions. If you still don’t understand certain aspects of Obamacare or want to purchase a plan, feel free to call one of our agents today!