What is “Obamacare” and how does it work?  

The Affordable Care Act (ACA)  often referred to as Obamacare, was designed to ensure that everyone who wanted access to healthcare could have it. This happened by creating a Health Insurance Marketplace where people could select the health care provider they wanted without fear of being denied coverage for pre-existing conditions. A list of essential health benefits was also added to the plan. This was signed into law in 2010.

How does it work?

The original law mandated everyone had to have health insurance, but it was repealed in 2017. There are some states that do have mandates in place though, so it is always good to check. In most instances, there is a monthly fee involved in having health insurance. ACA offers subsidies that help lower the cost of plans for individuals through tax credits. This helps more people qualify for assistance with these costs.

Now, the American Rescue Plan Act (ARPA) was signed into law in 2021, increasing the previous subsidies offered through ACA. Those within 100% to 150% of the federal poverty level now qualify for zero-premium silver plans, and those between 150% and 400% of the poverty line can receive higher subsidies. For those Americans making over 400% of the federal poverty level who didn’t qualify previously, premiums are now restricted to 8.5% of the income of those individuals.

There are different enrollment periods that must be followed. This enrollment period is usually from November 1 through December 15, which starts the coverage on January 1. That period expires on January 15. There are different qualifying events that allow individuals to purchase coverage outside of the enrollment period, like:

  • Unemployment
  • Losing previous insurance coverage
  • New baby
  • Moving to a new area
  • Marriage
  • Divorce
  • Death

What does the Affordable Care Act (ACA) cover?

ACA covers services in 10 categories, including emergency care, preventative care, outpatient care, hospitalization, pregnancy and newborn care, rehabilitative services, mental health and substance abuse disorders, pediatric care, prescription drugs, medical devices, and laboratory care.

There are many different health care plans, providers, and specialists that are now available to individuals and families who would have otherwise gone without treatment. The marketplace makes it easier to find the right insurance plan for the right price that has all the benefits and services you may need. Premiums and coverage do vary based on state and plan. There are some plans that cover additional services that are outside of the original 10 which may include dental.

Additionally, some of the plans require approval to see a specialist for certain things. It’s important to know exactly what the plan covers and how it works. Speaking with a professional who is well-versed in the plans you see in the marketplace can assist in choosing the one that would be most beneficial to your specific situation. Fully understanding any out-of-pocket expenses and restrictions you may encounter is key in making the final decision.

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