ACA is the Health Insurance program, facilitated and subsidized by the US government to ensure that American Citizens have affordable access to high quality basic healthcare.
- It provides a framework which makes healthcare more available, more affordable and more accessible.
- There are four main planks:
- Insurance: spreads the cost of healthcare across the population and ensures that individuals and families have affordable access to preventative care and the treatment they need.
- Defined Benefits: ensure that health insurance plans offered to the public cover a comprehensive package of services, known as Minimum Essential Coverage (MEC)
- Cost Control: which sets limits on the charges made for treatments and care provision and creates a competitive and open health insurance marketplace/health insurance exchange for providers and individuals or groups, to exercise choice
- Federal /State Funding: certain groups of citizens, e.g. senior citizens, dependent children obtain benefits under the Medicaid and Medicare but all health insurance premiums are subject to tax relief.
The basics of shopping for affordable Health Insurance
Insurance is concerned entirely about the future, about what the financial implications, for us and our dependents, might be in the event of an accident or illness. After all, we insure ourselves against the cost of a car accident and the cost of replacing lost or stolen property. It is natural that we should insure ourselves against the cost of medical care and loss of income in the event of illness or accident.
- The Affordable Care Act is the umbrella which first, obliges all American citizens, unless otherwise exempted e.g. seniors and dependent children, to be covered by health insurance policies which must meet the Minimum Essential Coverage (MEC) as defined by the ACA. (See Appendix 1 for details of MEC provisions).
- Secondly, it ensures that there is a genuine marketplace or exchange where individuals and employers can purchase health insurance which meet the requirements of the MEC and still allow flexibility in the choice of provider and level of service.
- Thirdly, unless exempted all US citizens must have qualifying health insurance cover. There is a tax penalty for those who are not covered.
The tax is calculated either as
2.5% of household income or
%695 per adult and %347.50 per child under 18, whichever is the higher.
NOTE. The tax penalty may be greater than the cost of health insurance AND you will still be faced with the medical bills.
How does the Health insurance marketplace or Health insurance exchange work?
The Health Insurance Marketplace has three strands:
- The federally facilitated marketplace,
The government Exchange or more commonly, Healthcare. gov is the central exchange (information and purchase point) maintained by the Department of Health and Human Services. It is a secure online portal through which American citizens can shop for health insurance coverage.
The Department of Health and Human Services creates and enforces the MEC criteria and determines the prices which suppliers may charge for services, prescription drugs and mechanical aids e.g. wheel chairs.
Its remit goes no further than to offer health insurance policies that meet the MEC criteria. and provide advice on the subsidies and premium tax credits which may be available.
- The government exchange (healthcare.com) also allows individual states to operate in the Health insurance marketplace.
Just over 50% of US States use the Government exchange the others operate either their own (State Exchanges) or work with nominated insurers (carriers) to provide services which reflect their specific state needs (State Marketplace). In either case they may only offer health insurance policies on terms which are equal to, or better than FFM terms (see appendix 2 for your State details.
- The Act also provides for a private Health insurance market; Health Insurance Exchanges
A private health insurance exchange is an exchange run by a private sector company or in some cases non-profit organizations.
- Health plans and insurance carriers in a private exchange must meet the same the standards in terms of quality and coverage as Healthcare.gov and the state-run exchanges
- have greater freedom to offer both individuals and groups a wider choice of insurance options e.g. dental, vision and medial supplementals to provide comprehensive cost-effective coverage
- bring together technology and market knowledge to offer ’best value’ choices.
- aim is to help consumers find plans personalized to their specific health conditions, preferred doctor/hospital networks, and budget.
- work directly with insurers, on behalf of the consumer to provide appropriate, affordable health insurance coverage.
The three alternatives are defined as being ‘on exchange’ i.e. you have a single point of contact but access to a wide range of alternatives and the assurance that you benefit from the benefits and allowances to which you may be entitled.
The Affordable Care Act does not exclude individuals or groups from obtaining their Health Insurance coverage directly from an insurance company, OFF EXCHANGE. By dealing direct you may negotiate coverage that meets specific requirements (which must meet the MEC for any health insurance coverage) but you may not benefit and tax reliefs which may apply if you choose to be ‘on exchange’
By reducing premium and out-of-pocket costs for tens of millions of families and small business owners who would otherwise be priced out of coverage in the past. This brings Health insurance to over 32 million Americans who would not otherwise be covered – and makes the cost of coverage more affordable for many others.
What are the essential health benefits covered under the ACA?
The Affordable Care Act ensures that health plans offered in the individual and small group markets, both inside and outside of the Health Insurance Marketplace, offer a comprehensive package of items and services, known as essential health benefits. Essential health benefits must include items and services within at least the following categories
- Ambulatory patient services (Outpatient care). Care you receive without being admitted to a hospital, such as at a doctor’s office, clinic or same-day (“outpatient”) surgery center. Also included in this category are home health services and hospice care (note: some plans may limit coverage to no more than 45 days).
- Emergency Services (Trips to the emergency room). Care you receive for conditions that could lead to serious disability or death if not immediately treated, such as accidents or sudden illness. Typically, this is a trip to the emergency room, and includes transport by ambulance. You cannot be penalized for going out-of-network or for not having prior authorization.
- Hospitalization (Treatment in the hospital for inpatient care). Care you receive as a hospital patient, including care from doctors, nurses and other hospital staff, laboratory and other tests, medications you receive during your hospital stay, and room and board. Hospitalization coverage also includes surgeries, transplants and care received in a skilled nursing facility, such as a nursing home that specializes in the care of the elderly (note: some plans may limit skilled nursing facility coverage to no more than 45 days).
- Maternity and newborn care. Care that women receive during pregnancy (prenatal care), throughout labor, delivery and post-delivery, and care for newborn babies.
- Mental health services and addiction treatment. Inpatient and outpatient care provided to evaluate, diagnose and treat a mental health condition or substance abuse disorder. This includes behavioral health treatment, counseling, and psychotherapy.
- Prescription drugs. Medications that are prescribed by a doctor to treat an illness or condition. Examples include prescription antibiotics to treat an infection or medication used to treat an ongoing condition, such as high cholesterol. At least one prescription drug must be covered for each category and classification of federally approved drugs, however limitations do apply. Some prescription drugs can be excluded. “Over the counter” drugs are usually not covered even if a doctor writes you a prescription for them. Insurers may limit drugs they will cover, covering only generic versions of drugs where generics are available. Some medicines are excluded where a cheaper equally effective medicine is available, or the insurer may impose “Step” requirements (expensive drugs can only be prescribed if doctor has tried a cheaper alternative and found that it was not effective). Some expensive drugs will need special approval.
- Rehabilitative services and devices – Rehabilitative services (help recovering skills, like speech therapy after a stroke) and habilitative services (help developing skills, like speech therapy for children) and devices to help you gain or recover mental and physical skills lost to injury, disability or a chronic condition (this also includes devices needed for “habilitative reasons”). Plans have to provide 30 visits each year for either physical or occupational therapy, or visits to the chiropractor. Plans must also cover 30 visits for speech therapy as well as 30 visits for cardiac or pulmonary rehab.
- Laboratory services. Testing provided to help a doctor diagnose an injury, illness or condition, or to monitor the effectiveness of a particular treatment. Some preventive screenings, such as breast cancer screenings and prostrate exams, are provided free of charge.
- Preventive services, wellness services, and chronic disease treatment. This includes counseling, preventive care, such as physicals, immunizations and screenings, like cancer screenings, designed to prevent or detect certain medical conditions. Also, care for chronic conditions, such as asthma and diabetes. (Note: please see our full list of services for details on which services are covered.)
- Pediatric services. Care provided to infants and children, including well-child visits and recommended vaccines and immunizations. Dental and vision care must be offered to children younger than 19. This includes two routine dental exams, an eye exam and corrective lenses each year.
While all qualified plans must offer the ten essential benefits, the scope and quantity of services offered under each category can vary.
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