Some of the Patient Protection and Affordable Care Act (ACA), also known as Obamacare, is already in effect in Michigan, while other parts will not take effect until 2014, according to Michigan’s Department of Insurance and Financial Services (DIFS). The new health care reforms will be phased in over time.
Reforms currently in effect
Most of the following provisions of the Affordable Care Act went into effect on or after Sept. 23, 2010.
- Extended coverage for young adults requires most health carriers and employers to make coverage available to adult children up to the age of 26. This applies to adult children who are financially dependent on their parents, live with their parents, are married, or have a job but no access to coverage from their employer. Children do not have to be students.
- New health plans must provide no-cost preventive care. This eliminates any copay, deductible, or coinsurance for certain preventive services such as immunizations, flu shots, mammograms and screenings for abdominal aortic aneurysm, alcohol misuse, blood pressure, cholesterol, colorectal, depression, diabetes, diet, HIV, obesity, STD and tobacco use.
- Children under the age of 19 cannot be denied coverage because of an illness or chronic condition.
- Seniors who are in the Medicare prescription drug coverage gap, also known as the “donut hole” will be given discounts on covered prescription drugs.
- Health coverage cannot be rescinded or retroactively canceled unless fraud or an intentional misrepresentation of an important fact has been committed.
- New health plans are prohibited from setting lifetime limits on benefits such as emergency and hospitalization services.
Coming in 2014
People who are uninsured, purchase their own individual coverage, or have employer coverage that is inadequate or unaffordable will be able to shop for coverage from the federal Health Insurance Marketplace. This is where individuals and small businesses can compare and purchase health benefit plans. Open enrollment for 2014 is Oct. 1, 2013 - March 31, 2014.
States will decide if residents who earn less than 133 percent of the federal poverty level (about $11,490 for an individual or $23,550 for a family of four) will be able to enroll in Medicaid in 2014.
People who earn between 100 percent and 400 percent of the federal poverty level (about $45,960 for an individual or $94,200 for a family of four) may receive federal tax credits to assist with the cost of coverage from the Health Insurance Marketplace.
Beginning in 2014 there will be an “individual mandate” that requires people to obtain health insurance or pay a federal tax penalty. Anyone who already has coverage from an employer, Medicare or Medicaid will be considered covered.
People who do not purchase coverage will be penalized the greater of:
- In 2014 the penalty will be $95 per adult or 1 percent of taxable income.
- In 2015 the penalty will increase to $325 per adult or 2 percent of taxable income.
- In 2016 the penalty will increase even more to $695 per adult or 2.5 percent of taxable income.
However, any who has a financial hardship, belongs to a Health Care Sharing Ministry, has a religious objection or the cost of insurance would be more than 8 percent of their income may be exempt from paying the penalty.
In 2014, people with an illness or chronic condition cannot be denied coverage or be charged more for a pre-existing medical condition.
Efforts are currently underway in Michigan to begin enrolling the uninsured in the Affordable Care Act beginning Oct. 1, 2013. The federal government is currently enlisting nonprofits in Michigan to reach residents who will need to sign up for health insurance to avoid a penalty.