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What is Obamacare? The Affordable Care Act Explained

The Affordable Care Act (ACA) has been in the news more and more lately, and you’ve likely seen the word Obamacare pop up on the internet or your news feed at least once in that time. But what exactly is Obamacare?

The Patient Protection and Affordable Care Act, sometimes known as the Affordable Care Act or Obamacare, is a significant piece of U.S. federal legislation. The legislation was passed by the 111th Congress and was signed into law by President Barack Obama on March 23, 2010.

And, perhaps even more importantly, why do so many people seem to be talking about it these days? If you’re among those wondering what Obamacare is, then this article will give you all the information you need to understand this new law and its impact on health insurance coverage in the U.S. today.

We will delve into the important topics on your mind, including:

  • What is Obamacare
  • The benefits of Obamacare
  • Affordable Care Act eligibility
  • Obamacare and the Health Insurance Marketplace
  • The cost of Obamacare and whether it is expensive

This piece even touches on the taxpayer portion of this new law. Continue reading to get powerful information on this change to the way Americans are getting health insurance.

What is Obamacare?

Obamacare, also known as the Affordable Care Act, was designed to help millions of Americans access affordable health insurance plans. It does this by bringing down the cost of health insurance and offering options on government-run health exchanges.

So, how does it work? According to the Affordable Care Act, health insurance providers must include specific levels of coverage with each plan. Much like drivers who are required to carry insurance, Americans were obligated to have health insurance. However, the federal government no longer mandates health insurance as of 2019.

The goal of the Affordable Care Act was to reduce costs for consumers in the long term. While the individual mandate carries a penalty to deter those who are uninsured, there are some exemptions if certain criteria are met. These criteria include being medically uninsurable or experiencing short coverage gaps of less than three months. This exemption status will allow more people to have access to affordable health care and subsequently, stop avoiding medical care due to issues of affordability.

The Benefits of Obamacare

The Affordable Care Act (a.k.a. Obamacare) offers affordable health insurance that protects against preexisting conditions and provides preventative care. In instances where challenging health backgrounds prevented coverage, there had become a path to insured status.

Many people now find health insurance to be more affordable thanks to the Affordable Care Act. In fact, some rates have decreased as a result of the requirement that health insurance firms utilize at least 80% of their premiums on healthcare costs.

Obamacare also banned insurers from charging women more than men and the denial of coverage for anyone under the age of 26 because of a pre-existing condition. The legislation allows young adults to remain on a parent’s plan for up to three years after graduating college or leaving home.

The Affordable Care Act has provisions that require Americans to buy health insurance. In 2016, the penalty for not having a qualified healthcare plan was steep. It ranged from $695 per year up to 2.5% of annual income, depending on how long you go without insurance.

If you’re considering applying through the marketplace but are worried about cost, don’t fret!

Who is eligible for Obamacare?

Eligibility for Obamacare (The Affordable Care Act) depends on your income, where you live, and whether you are eligible for other coverage. If you have a job with employer-sponsored health insurance, it will be difficult to get subsidized coverage through the Marketplace.

Fortunately, Obamacare allows people to purchase health insurance regardless of their financial level. You may be eligible for a premium tax credit or other special subsidies that will lower the cost of your health insurance if your family income is between 100% and 400% of the federal poverty level (FPL).

Obamacare was designed to make sure that Americans from all walks of life had affordable healthcare coverage. For example, a family of four making less than $47,000 can qualify for Medicaid coverage if they reside in one of the states that chose to expand their Medicaid program under the ACA.

Let’s have a look at how the Marketplaces created by Obamacare provide access to insurance.

Obamacare and the Health Insurance Marketplace

The Affordable Care Act, better known as Obamacare, is a law passed by Congress in 2010 that seeks to make health insurance more affordable and accessible to everyone. It also includes provisions to protect consumers from unfair practices by insurance providers.

People with pre-existing medical issues can still acquire health insurance. Because of pre-existing conditions, insurance companies can no longer deny coverage to someone. In fact, Healthcare.gov is the federal marketplace for people who don’t have coverage through their employer. Additionally, those not under a government program like Medicaid or Medicare can find numerous plans with different levels of coverage and prices.

These plans are called bronze, silver, gold, and platinum. You may be eligible for financial assistance.

The Health Insurance Marketplace even offers assistance in choosing a health plan and enrolling in it via websites, phone centers, and in-person assistance. This assistance can help make the most informed choice for you or your loved ones.

Is Obamacare expensive?

The Affordable Care Act (ACA) is the law that requires Americans to have health insurance coverage. It also says what’s covered and how much people can expect to pay. You may qualify for financial help with your premiums and out-of-pocket costs if you:

  1. Make between about $11,000 and $46,000 for a family of four (depending on your state)
  2. Live in one of the 37 states that expanded Medicaid eligibility under Obamacare
  3. Have a pre-existing condition or are pregnant (regardless of income)
  4. Are an American Indian or Alaska Native living outside the lower 48 states who receive health care through tribal programs

While there is some variety between options, Obamacare plans typically cost between $328 and $482 per month. Actual costs will see changes based on the provider, the particular plan, and your location. There are instances where plans include high deductibles, coinsurance, and copayments.

Who pays for Obamacare?

Obamacare was originally made up of two main parts: the affordable care act and the individual mandate. The affordable care act dictates what insurance companies can charge for premiums, whereas the individual mandate stated that people who do not have insurance must purchase a plan. That mandate has since been repealed.

These costs are where taxes come into play; taxpayers are responsible for paying for the Affordable Care Act, which helps cover those without healthcare coverage with subsidies to help them buy their own health plan.

Wealthy taxpayers also contribute to the cost of Obamacare. To pay for Medicare’s hospital insurance, the health law mandates that employees pay a tax equal to 0.9% of their wages over $200,000 for single filers and $250,000 for married couples filing jointly.

For those newly covered as a result of the Medicaid expansion, the federal government covers all coverage costs in full under the ACA. Hopefully, you are ready to make the best decision on health insurance with a look at the history of Obamacare and its impact on coverage.

Stay plugged into EnhanceHealth.com to get the most powerful information on health insurance. You can be even more effective in taking care of your health and that of your family with BestPricedHealthPlans.


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