If you’re like many Americans, the prospect of dealing with the intricacies of the Affordable Care Act, otherwise known as Obamacare, is a horror. It’s a complex health insurance plan which a survey of more than 12,000 people found 60 percent of the people just plain don’t understand. We’re here to help you understand Obamacare.
Of the people surveyed by Health Affairs, more than half of those who would sign up for Obamacare don’t completely understand many critical concepts of the plans.
According to another study from Carnegie Mellon University, more than 80 percent of Americans aged 25 to 64 are not only baffled by Obamacare, but were put off by the very idea of health insurance details. According to the lead author, George Loewenstein, “research has shown that consumers can be overwhelmed and make worse decisions when they are given too much choice.”
Political scrums over Obamacare will certainly continue for years to come, and the ACA may well be the most misunderstood social program in history. We’re hoping, in plain English, to give you some important details about how the law works now. We also want to offer a bit of truth which ignores the political arguments dominating the news.
Experts tasked with helping customer sign up for the plan say the vast majority of their contacts start by asking very basic questions about insurance before they’re ready to confront the details of plans such as “premium tax credits” and “cost-sharing reductions.”
At it’s core, the ACA was enacted to ensure that Americans can gain access to affordable health insurance, and it offers consumers discounts – or tax credits – on government-sponsored health insurance plans. It also expanded the Medicaid assistance program to help those same people cover the cost of health care. The plan changed rules which guide insurance companies regarding pre-existing conditions such as diabetes for which customers would have been turned down for coverage. The idea was to fight off astronomically high coverage costs and prevent you from being turned down – for any reason. The general concept was that ultimately, the plans would help contain costs.
Here are the nuts and bolts: You purchase your Obamacare plan on healthcare.gov if you live in a state which participates in the federal program, and if your state does not, from the healthcare website in your state if the federal plan isn’t available.
The Affordable Care Act is meant to increase factors like quality, accessibility and affordability of health insurance to all Americans. It was meant to eliminate major problems in the previous system.
– Insurance companies can no longer deny coverage – or jack up costs – for the treatment of preexisting conditions.
– Insurance companies can no longer drop anyone who becomes sick.
– There are “gender discrimination” elements in the law.
– Plans include certain “preventative services” and other health-related benefits – free.
– Medicaid and CHIP were expanded and improved
– The ACA requires that certain large employers insure their employees.
– The ACA built a “marketplace” aimed at creating subsidized insurance. It now provides tens of millions of individuals, families and smaller businesses free (or low-cost) health insurance.
One additional benefit? Experts say it has decreased healthcare spending and cut the budget deficit.
Keep in mind that if you already have insurance through an employer, you’re off the hook and don’t have to know these details. The ACA was aimed, for the most part, at people and smaller groups who stuck paying for their own health insurance.
As for the bottom line numbers, you’re eligible to receive the tax credit discounts for health insurance costs if you meet income criteria. Say your household income is somewhere around one and four times the Federal Poverty Level. If it does, the plan says your basic needs – food, shelter and the like – mean you’re eligible to apply the credits to lower your monthly insurance bill premiums. You can also hold off and declare the credits on your tax return at the end each year. It’s pretty easy to find a calculator online to determine where you fall on the scale according to your income and let you know if you qualify for these tax credits.
Say your income means you’re not in that range.
Making too much cash to qualify for the credits won’t prevent you from buying a plan from the federal insurance marketplace or your state, but it does mean you won’t get discounts. Experts say it doesn’t mean you won’t get a good deal, so the plans are worth checking. And in addition, it’s possible that you may well be eligible for Medicaid or other assistance from the government.
Here’s where it gets dicey. Plans are grouped into four “tiers” named for various metals. From Bronze to Platinum, the levels are grouped by price and cost-sharing factors based on percentages. If you fall in the “Bronze” plan, it’s the cheapest, but it only covers 60 percent of total medical costs. If you fall in the “Platinum” plan range, while your coverage might be the most expensive, it does pay out up to 90 percent of your medical costs.
Now you’re faced with the details of selecting a plan which not only meets your needs, but also allows you to continue with your favorite physicians in a network. You’re also going to want to select a plan that addresses the price of filling the prescriptions you use most often.
Let’s say your income falls in the group who earn from one to 2.5 times enough money to put them above Federal Poverty Level. Experts say your should select a “Silver.” That plan will cover 70 percent of your medical bills, but you might also get an automatic upgrade to a “Gold” plan. If that happens, you will receive the benefit of an 80 percent payout of medical bills – and at no extra charge.
And regardless of any conspiracy theories you may have heard, you’re not going to jail if you don’t sign up.
If you meet income-based criteria you are required by law to have insurance, Medicare or Medicaid. If not, you pay a penalty when you file your tax returns.
If you’re a Senior citizen on Medicare, you are among the lucky few who can ignore the ACA and Obamacare.
Now that we’ve covered all that, be prepared for change as politicians are planning to overhaul or eliminate the ACA and Obamacare if they can find the necessary support…