Affordable Care Act

Contents

Provisions

  • Premium subsidies are provided to low and middle income families
    • About half the people in the individual market get tax subsidies
  • Health insurers are prohibited from denying coverage to people for any reason, including health status, and from charging higher premiums based on health status and gender
  • Young adults are allowed to remain on their parent’s health insurance up to age 26.
  • Everyone, with certain exceptions, is required to have health insurance or pay a penalty.
  • Medicaid
    • Expanded to 138% of the federal poverty level
  • Medicare
    • Medicare coverage is extended to certain preventive services, like mammograms and colonoscopies, with no charge for Part B coinsurance or deductible.
    • Free, annual wellness visits are covered.
    • The Donut Hole of Medicare Part D is gradually closed, disappearing in 2020.

Three-legged Stool, Plus Taxes

  • Regulation Leg
    • Health insurance plans must meet minimum standards
    • Insurers must charge the same rates for the same plans, regardless of pre-existing conditions
  • Mandate Leg
    • Everyone must have health insurance or pays a penalty
  • Subsidy Leg
    • Subsidies are provided to those who can’t afford health insurance, which includes expanding Medicaid
  • New Taxes
    • For example, a 3.8% tax on net investment income for high-income taxpayers

Timeline

  • 2010: ACA goes into effect
  • 2012 Supreme Court rules that the individual mandate was constitutional under Congress’s taxing power and that the law’s expansion of Medicaid was constitutional as long as it wasn’t mandatory.
  • 2013: The federal health insurance exchange at HealthCare.gov officially opened
  • 2015: Supreme Court overturned an appeals court decision that the federal government could not subsidize individual health insurance policies purchased on the federal exchange because a provision of the ACA that determined the amount of such subsidies referred only to exchanges “established by the State.” 
  • 2010-2016: Republican-controlled Congresses voted 60 times to repeal the ACA
  • 2017: Republicans in Congress passed a tax cut that included a provision which effectively repealed the individual mandate by reducing the penalty for failing to carry health insurance to $0 beginning in 2019.
  • 2018: A Texas district court district court held that the individual mandate was unconstitutional, since it could no longer be enforced as a tax, and was not “severable” from other provisions of the ACA.  The court declared the entire ACA unconstitutional.
  • 2020: In an 82-page brief the Trump administration supported the district court’s ruling, arguing that the “entire ACA thus must fall with the individual mandate,” including the “provisions for guaranteed-issue and community-rating” (which protect against pre-existing conditions).
  • 2020: The Supreme Court is scheduled to hear the case, known as California v US, in its 2020–21 term.

Medicare Expansion

KFF Status of State Action on the Medicaid Expansion Decision

As of August 5, 2020

Assessment of the ACA as it turns 10
How has the law worked in its first decade?

New York Times Upshot Obamacare Turns 10. Here’s a Look at What Works and Doesn’t, by Abby Goodnough, Reed Abelson, Margot Sanger-Katz, and Sarah Kliff

NYT: ACA has greatly expanded coverage
Image Credit: NYT Obamacare turns 10
  • The biggest advance has been the huge increase in coverage of poor people.
  • Medicaid enrollment increased by about 13 million, or 34 percent, in the so-called expansion states between 2013 and 2019, according to federal data. The uninsured rate for poor adult citizens with no dependent children — a group that had often been ineligible for Medicaid — plummeted, dropping to 16.5 percent in 2015 from 45.4 percent in 2013, according to the Urban Institute
  • Over all, the largest coverage gains under the A.C.A. have been among Hispanic, black and Asian patients — many of the groups that had the highest uninsured rates before the law, the Kaiser Family Foundation found.
NYT: ACA hasn’t curbed costs enough
  • But for all the success, over the last couple of years, the uninsured rate has started creeping back up. In 2018, 8.5 percent of the population did not have health insurance, up from 7.9 percent the year before, the Census Bureau reported. It was the first increase since the Affordable Care Act passed, and came even as the economy was doing well. 
  • Still, health care remains unaffordable for many middle-class people, who don’t qualify for Medicaid or federal subsidies to help buy an individual policy.
  • The average premium for a midlevel plan for a 40-year-old who doesn’t qualify for a subsidy has climbed to $462 a month in 2020 from $273 in 2014, according to the Kaiser Family Foundation. And the law has done little to address soaring prescription drug costs and staggering deductibles.
NYT: ACA has saved lives
  • The first big study looked at what happened to older low-income adults. It showed that those who lived in states that chose to expand Medicaid coverage were less likely to die than people with similar demographic characteristics in states that chose not to expand.
  • The second study used an even stronger methodology. Employees at the Treasury Department used tax records to identify Americans who were uninsured, then mailed a letter about health insurance options to a random sample of them. Researchers found less insurance and more deaths in the group that didn’t get a letter. Because that study cut across every state, and because the experiment used a random method of selection, several scholars who had previously been unsure say they are now convinced that the law’s expanded health insurance coverage is making a meaningful difference in physical health.
NYT: ACA’s biggest flaw
  • Most health insurance plans have deductibles, an amount that patients need to pay before coverage kicks in. The Affordable Care Act, however, allowed insurers to set deductibles significantly higher than those typically faced by Americans who get health insurance at work.
  • Individual deductibles can go as high as $8,150. For families, the limit rises to $16,300.
  • The White House and Congress wrote those amounts into the law when they drafted it in order to keep the law’s overall price tag down. Looking back, they question that decision.
  • Surveys of health law enrollees show that the deductibles are patients’ biggest struggle, more so than concerns about having enough doctors in-network or even the price of the premiums. In interviews, people with coverage through the law said they’re simultaneously grateful to have the peace of mind that comes with health insurance and frustrated that they still can’t afford to see a doctor.

ACA and Health Care Models

Like Medicare Parts C and D, health care and insurance under the ACA are provided by the private sector.

Why Republicans are against Obamacare

Trump’s claim “he will ‘always’ protect those with preexisting conditions”

  • Washington Post Fact Checker:  Bottomless Pinocchio: Trump’s claim that he will ‘always’ protect those with preexisting conditions
    • “I will ALWAYS PROTECT PEOPLE WITH PRE-EXISTING CONDITIONS, ALWAYS, ALWAYS,ALWAYS!!!”, Trump, June 27, 2020
    • Trump has claimed nearly 100 times since he took office that he will “always protect people with preexisting conditions,” but the legal brief filed by the Justice Department last week belies the president’s claim. It says point blank that the entire Affordable Care Act — including its coverage guarantee for people with preexisting conditions — “must fall.”
    • Trump has offered no plan to replace these, or any, provisions of the law. He has supported legislation to water down protections for people with preexisting conditions, and his administration has issued new rules promoting plans that allow insurance companies to deny coverage or charge higher prices to sick patients.