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‘The truth about the Affordable Care Act’ by Patricia Tramble

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Although signed into law by President Obama in March 2010, there still seems to be a growing confusion and concern over this bill. The Affordable Care Act (ACA) was designed for all Americans to have health insurance or face financial penalties. Current concerns include cost, tax, affordability, and how the ACA will affect those who currently have health insurance. December 13, 2013 was the official start date to sign up for health insurance.

The ACA expands Medicaid eligibility to participating states who are among the poorest Americans whose income is at 133% of the federal poverty line. This law will also assist those who live at 400% of the poverty level to help them by private insurance on the new state health exchange. According to Janet Varon, executive director of the Northwest Health Law Advocates in Seattle which works on health access issues, the financial help isn't enough for some. "Even with the subsidies, some people simply won't be able to manage to pay their health insurance premiums consistently with all the other costs facing them."

The authors of the ACA anticipated this problem. To address it, the law allows states to create a separate insurance program, called the Basic Health Program, for people who earn too much to qualify for Medicaid and too little to afford insurance on the state exchanges, even with federal aid. Under such a plan, the federal government will give the subsidies directly to the states, instead of to individuals and families. The states are supposed to pool the money and then use the financial leverage to push insurers to offer less expensive coverage. However, this law may not go into effect until 2016. USA Today, 01/14/2914.

What is a health insurance exchange?

It's an online marketplace where individuals and small employers can shop for insurance coverage. Enrollment began Oct. 1 for policies that will go into effect on Jan. 1. The exchanges will also help people find out if they are eligible for federal subsidies to help cover the cost of coverage or if they are eligible for Medicaid, the federal-state health insurance program for the poor.

When can I shop at my exchange?

You can enroll until March 31, 2014, though you'll need to sign up and pay your first premium by Dec. 15 of this year if you want to be covered when the mandate to carry health insurance kicks in on Jan. 1. If you sign up and pay premium between Dec. 16 and Jan. 15, 2014 - coverage starts on February 1.

Jan. 16 - Feb. 15: coverage begins March 1.
Feb. 16 - March 15: coverage begins April 1
March 16 - 31: coverage begins May 1.

Generally, people will be able to enroll in or change plans once a year during an annual open enrollment period. This first year, that period is unusually longer in subsequent years the time period will be shorter, running from Oct. 15 to Dec. 7. Frequently asked Questions.

The rights and protections that cover Americans under the ACA health care law:

  • Creates the Health Insurance Marketplace, a new way for individuals, families, and small businesses to get health coverage.
  • Requires insurance companies to cover people with pre-existing health conditions
  • Helps you understand the coverage you’re getting
  • Holds insurance companies accountable for rate increases
  • Makes it illegal for health insurance companies to arbitrarily cancel your health insurance just because you get sick
  • Protects your choice of doctors
  • Covers young adults under 26
  • Provides free preventive care
  • Ends lifetime and yearly dollar limits on coverage of essential health benefits
  • Guarantees your right to appeal

Questions? Call 1-800-318-2596, 24 hours a day, 7 days a week. (TTY: 1-855-889-4325)

The Applicable penalty for no insurance

The individual one-time penalty under ACA in 2014 will be $95 per adult, or one percent of your income, whichever is greater. So say your annual income is $50,000, you’d pay $500. For every uninsured child, the penalty is $47.50. The family maximum is $285.

The penalty “is enforced through a (Internal Revenue Service) tax code,” noted Karen Pollitz, a senior fellow at the Kaiser Family Foundation in Washington, D.C. “Coverage is assessed on a monthly basis,” said Pollitz. “So if you were uninsured for six months, you’d owe half the otherwise applicable penalty.”

She said that the government has given a wide window – from Oct. 1, 2013 to March 31, 2014 – for enrollment this time, but from next year on there will only be a three-month window to sign up. ACA will be fully implemented on January 1, 2014, when most legal U.S. residents will be required to have “minimum essential health coverage” or make a “shared responsibility payment,” as the Congressional Budget Office puts it in regulations it rolled out last fall. That’s code for penalty.

So when you file your 2014 tax returns, you will have to let Uncle Sam know what kind of health insurance coverage you have and what, if any, tax credit you are eligible for, unless you can claim you are exempt from buying health insurance.

Non-financial exclusions include:

• You are between jobs and without insurance for up to three months.
• It contradicts your religious beliefs.
• You are an undocumented immigrant.
• You are a member of an Indian tribe.
• You are in jail.

Understanding the Titles of the Affordable Care Act

The Affordable Care Act addresses the following topics in detail. Each topic is a title, which contains sections of provisions that reform our health care system.

Title I Quality, affordable health care for all Americans

This Act puts individuals, families and small business owners in control of their health care. It reduces premium costs for millions of working families and small businesses by providing hundreds of billions of dollars in tax relief – the largest middle class tax cut for health care in history. It also reduces what families will have to pay for health care by capping out-of-pocket expenses and requiring preventive care to be fully covered without any out-of-pocket expense. For Americans with insurance coverage who like what they have, they can keep it. Nothing in this act or anywhere in the bill forces anyone to change the insurance they have, period.

Title II The role of public programs

The Act extends Medicaid while treating all States equally. It preserves CHIP, the successful children’s insurance plan, and simplifies enrollment for individuals and families

The Act gives flexibility to States to adopt innovative strategies to improve care and the coordination of services for Medicare and Medicaid beneficiaries. And it saves taxpayer money by reducing prescription drug costs and payments to subsidize care for uninsured Americans, as more Americans gain insurance under reform.

Title III Improving the quality and efficiency of health care

The Act takes important steps to make sure that we can keep the commitment of Medicare for the next generation of seniors by ending massive overpayments to insurance companies that cost American taxpayers tens of billions of dollars per year. As the numbers of Americans without insurance falls, the Act saves taxpayer dollars by keeping people healthier before they join the program and reducing Medicare’s need to pay to hospitals to care for the uninsured. And to make sure that the quality of care for seniors drives all of our decisions, a group of doctors and health care experts, not Members of Congress, will be tasked with coming up with their best ideas to improve quality and reduce costs for Medicare beneficiaries.

Title IV Preventing chronic disease and improving public health

The Act will promote prevention, wellness, and the public health and provides an unprecedented funding commitment to these areas. It directs the creation of a national prevention and health promotion strategy that incorporates the most effective and achievable methods to improve the health status of Americans and reduce the incidence of preventable illness and disability in the United States.

Title V Health care workforce

By funding scholarships and loan repayment programs, the number of primary care physicians, nurses, physician assistants, mental health providers, and dentists will increase in the areas of the country that need them most. With a comprehensive approach focusing on retention and enhanced educational opportunities, the Act combats the critical nursing shortage. And through new incentives and recruitment, the Act increases the supply of public health professionals so that the United States is prepared for health emergencies.

Title VI Transparency and program integrity

The Act helps patients take more control of their health care decisions by providing more information to help them make decisions that work for them. And it strengthens the doctor and patient relationship by providing doctors access to cutting edge medical research to help them and their patients make the decisions that work best for them.

It brings greater transparency to nursing homes to help families find the right place for their loved ones and enhances training for nursing home staff so that the quality of care continuously improves. The Act promotes nursing home safety by encouraging self corrections of errors, requiring background checks for employees who provide direct care and by encouraging innovative programs that prevent and eliminate elder abuse.

Title VII Improving access to innovative medical therapies

The Act promotes innovation and saves consumers money. It ends anti-competitive behavior by drug companies that keep effective and affordable generic drugs off the market. It extends drug discounts to hospitals and communities that serve low-income patients. And it creates a pathway for the creation of generic versions of biological drugs so that doctors and patients have access to effective and lower cost alternatives.

Title VIII Community living assistance services and supports

Establishing a Voluntary, Self-Funding Long-Term Insurance Choice for American Families. The Act provides Americans with a new option to finance long-term services and care in the event of a disability.

It is a self-funded and voluntary long-term care insurance choice. Workers will pay in premiums in order to receive a daily cash benefit if they develop a disability. Need will be based on difficulty in performing basic activities such as bathing or dressing. The benefit is flexible: it could be used for a range of community support services, from respite care to home care.

No taxpayer funds will be used to pay benefits under this provision. The program will actually reduce Medicaid spending, as people are able to continue working and living in their homes and not enter nursing homes. Safeguards will be put in place to ensure its premiums are enough to cover its costs.

Title IX Revenue provisions

The Act makes health care more affordable for families and small business owners by providing the largest middle class tax cuts for health care in American history. Tens of millions of families will benefit from new tax credits which will help them reduce their premium costs and purchase insurance. Families making less than $250,000 will see their taxes cut by hundreds of billions of dollars.

When enacted, health reform is completely paid for and will reduce the deficit by more than one hundred billion dollars in the next ten years.

Title X Reauthorization of the Indian Health Care Improvement Act

Reauthorization of the Indian Health Care Improvement Act:
The Act reauthorizes the Indian Health Care Improvement Act (ICHIA) which provides health care services to American Indians and Alaskan Natives. It will modernize the Indian health care system and improve health care for 1.9 million American Indians and Alaska Natives.

Hopefully, this gives a more comprehensive explanation of the current ACA, which some have erroneously referred to as, “Obamacare.” It has been the current President's mission to ensure that all Americans have health coverage. Given this is the first year of the ACA's implementation, there will be some bugs that need to be worked out.

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