Health Care Law that seeked to improve access and quality of health insurance to low-and-moderate income Americans.

On March 23, 2010, President Obama signed into law the Affordable Care Act (ACA), also known as the Patient Protection and Affordable Care Act (PPACA), the “federal health reform,” or Obamacare, a more-than-900-page medical system reform. On March 30, the ACA was amended by the Health Care and Education Reconciliation Act of 2010. 1 The ACA transformed the U.S. individual and small group insurance markets by increasing coverage and affordability, enacting consumer protections, and improving the quality of care and the healthcare system. In 2016, nearly 20 million more individuals had health coverage than before the ACA was passed. 2 Still, state-based exchanges and differences in Medicaid mean that there are wide variations in health coverage depending on where an individual lives, and recent changes in ACA implementation and legislation changes mean that the number of people covered and the coverage they receive may change over time.

Some of the main components of the ACA were:

Increasing health care coverage and affordability.
- Health insurance exchanges. The ACA mandates the creation of American Health Benefit Exchanges and Small Business Health Options Program (SHOP) Exchanges. These state-based, online marketplaces allow individuals and small businesses (up to 100 employees) to find, compare, and enroll in health plans (including Medicaid and CHIP), and apply for federal subsidies. 3
- Benefit tiers. The ACA created four benefit tiers of plans to be offered in the exchange as well as individual and small group markets outside of the exchange. The bronze, silver, gold, and platinum plans all provide the essential health benefits, have an out-of-pocket limit equal to the current Health Savings Account (HSA) legal limit, and respectively cover 60%, 70%, 80%, and 90% of benefit costs. 4
- Federal subsidies. The ACA establishes income-based, federal subsidies that individuals covered by an exchange can apply for using a single application. To qualify, individuals must not have access to coverage through their employer and must be ineligible for Medicare, Medicaid, and CHIP.
Coverage Requirements
- Individual. The ACA required U.S. citizens and legal residents to have health insurance either through the exchange or the market outside the exchange 5, or pay a tax penalty up to $2,085 per family. Exemptions include if the lowest cost plan exceeds 8% of one’s income, if one’s income falls below the tax filing threshold, or in cases of financial hardship. 6 The individual mandate was repealed as part of the 2017 Tax Cuts.
- Employer. The ACA requires employers to offer health insurance benefits either through the exchange or the market outside the exchange. 7 Employer responsibilities are determined by the size of the company.
Medicaid Expansion
- Extending eligibility to individuals below age 65 with a family income up to 133% FPL.
  - Starting in 2014, states were required to determine eligibility using the Modified Adjusted Gross Income (MAGI), which effectively raises the maximum income level for most Medicaid applicants to 138% FPL.
- Federally financing Medicaid 100% from 2014 to 2016, 95% in 2017, 94% in 2018, 93% in 2019, and 90% from 2020 onward, with states making up the difference.
- However, in a 2012 Supreme Court ruling, the Court restricted the federal government’s power to withhold Medicaid funds if a state does not institute the expansion, effectively giving states the choice of expanding Medicaid. 8
Other Provisions
- Pre-existing Conditions.The ACA prohibits insurance plans from excluding people for pre-existing medical conditions or from discriminating against individuals based on health status. 9
- Dependent Conditions. The ACA requires health plans to extend dependent coverage to an adult dependent, married or unmarried, up to age 26. 10

For more information, see here.

For the full text of the bill, see here.

Endnotes

2010 - Choice Neighborhoods Initiative

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