In Shared Responsibility Provision, a rule known

In this lesson, you’ll learn about the Affordable Care Act and how it impacts individuals with and without health insurance. You’ll also learn what benefits it provides to those with health insurance.

The Affordable Care Act

On March 23, 2010, President Barack Obama signed into law the Patient Protection and Affordable Care Act (PPACA). Most people refer to it as the Affordable Care Act (ACA) or simply as Obamacare after the president’s name. The purpose of the ACA is to increase the overall quality of health care, as well as to make health insurance more affordable for everybody.

Guaranteed Coverage

One of the provisions of the ACA is it guaranteed coverage for everybody. Prior to the ACA being signed into law, if you had a pre-existing condition you would often times be denied coverage when applying for individual health insurance. That is, if you were working for yourself and you needed health insurance, you had to be healthy in order to get health insurance.

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Many health insurance companies denied coverage to people with pre-existing conditions because they viewed them as high-risk and in need of health care, which the insurance company would then have to pay for. But, under the ACA now, health insurance companies can’t deny coverage to anyone anymore. If you have a pre-existing condition and you need health insurance coverage, they have to approve you for it and at the same rate they would offer to a healthy individual.

Important Provisions

Individual Shared Responsibility Provision

Along with this guaranteed coverage provision also comes the Individual Shared Responsibility Provision. This requires everybody to have health insurance.

If you don’t have health insurance, then you would pay a penalty with your federal taxes. Most people are required to pay the penalty for not having health insurance, but if your income is low enough, then you don’t have to.For tax year 2015, you are exempt from paying the penalty if you are single and earned less than $10,300 in gross income, or less than $20,600 in gross income if you are married filing jointly.The Individual Shared Responsibility Provision also requires that whatever health insurance you have must give you minimum essential coverage.

Most health insurance policies meet the minimum essential coverage requirement. But there are policies that cover only certain conditions, such as pregnancy-only coverage or emergency-only coverage. These policies don’t meet the minimum essential coverage requirement.

Employer Shared Responsibility Provision

In the Employer Shared Responsibility Provision, a rule known as the ’employer mandate,’ states that businesses employing 50 or more full-time employees must provide healthcare to 95% or more of them. Businesses will pay a fee on their taxes if they don’t provide this healthcare, which also must meet the minimum requirements of coverage.

Benefits

Another benefit of the ACA is it requires all health insurance policies to cover certain items. Preventative care, such as vaccinations and screenings, are to be 100 percent covered by insurance with no co-payments of any kind.

Here is a list of the medical services covered under the ACA:

  • Ambulance services
  • Emergency services
  • Hospital services
  • Mental health services
  • Behavioral health services
  • Rehabilitation services
  • Preventative services
  • Lab services
  • Prescription drugs
  • Maternity and newborn care services
  • Pediatric services that include vision and dental care

Lesson Summary

Let’s review. The Patient Protection and Affordable Care Act (PPACA) was signed into law on March 23, 2010 by President Barack Obama. The purpose of the PPACA is to increase the overall quality of health care, as well as to make health insurance more affordable for everybody. All health insurance companies are required to guarantee coverage to all, even those pre-existing conditions.

Under the ACA, the Individual Shared Responsibility Provision requires everyone to have health insurance that meets the minimum essential coverage requirement. If they don’t, they will pay a penalty through their federal taxes. However, if your gross income is less than a certain amount, then you are exempt from paying this penalty.In the Employer Shared Responsibility Provision, a rule known as the ’employer mandate’ states that businesses employing 50 or more full-time employees must provide healthcare to 95% or more of them.Some of the benefits that health insurance policies are required to offer include:

  • Ambulance and emergency services
  • Rehabilitation services
  • Prescription drugs
  • Pediatric services that include vision and dental care
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