The Affordable Care Act
affordable care act3 min read
Learn More about the Affordable Care Act
You’ve heard the term over and over throughout the years, but what exactly is the Affordable Care Act? The Affordable Care Act (ACA) is a shorter name for the Patient Protection and Affordable Care Act which was signed into law by President Barack Obama in 2010.
The Affordable Care Act, most commonly refered to as "Obamacare" was implemented to regulate the health care industry, provide more Americans with affordable health insurance, and improve the quality of health insurance and health care in the United States.
The Affordable Care Act - What does it do?
In 2013, over 44 million Americans were living without health insurance, mainly because of the high costs to obtain it. Although the Affordable Care Act does have its pros and cons, it accomplishes the following and more:
Makes it mandatory that all Americans have health insurance through a private provider or a federally assisted program;
Offers cost assistance and affordable quality premiums through the health insurance marketplace;
Healthcare providers are no longer allowed to drop you if you become ill, even if you made an honest mistake on your health care application;
Expands Medicaid eligibility so low income families could pay for the cost of health insurance;
- Permits young adults to stay on their parents’ plan until age 26;
Terminates lifetime limits on health insurance coverage;
Prohibits being denied coverage because of a past illness or be charged more based on gender; and
Reforms Medicare by providing Medicare recipients with new protections and benefits.
The Health Insurance Marketplace
The Health Insurance Marketplace is the online marketplace where Americans can now shop for more affordable health care insurance. To do so, personal information will be entered to determine whether someone is eligible for Medicaid, lower premiums, or reduced out-of-pocket costs.
Each state has its own marketplace. If you are shopping for insurance, you should refer to your state’s marketplace to shop for health care insurance at any time to determine your eligibility and compare rates.
Remember that you can only enroll during the enrollment period at healthcare.gov. The open enrollment period for 2014 ended in March, but open enrollment for the 2015 year begins November 15th, 2014.
Since the Affordable Care Act requires you to have some sort of health insurance, make sure to enroll or you will be paying a penalty for each month you are without health insurance. This penalty is 1% of your income or $95 per adult, whichever is greater. In 2015, the penalty increases to 2% of your income or $325 per adult.
How the Affordable Care Act Relates to Business Owners
Your business size will effect the type of penalties you incur if you decide not to provide health care insurance for your employees.
If you are a business owner with:
25 full-time employees or less - you will receive tax breaks of up to 50% if you provide health insurance to your employees.
50 full-time employees or more - you may provide insurance that meets ACA standards or starting January 2015, pay a $2000 tax per employee (for all but the first 30 employees).
99 full-time employees or less - you should shop for insurance on your state’s health insurance marketplace to cover your employees. One incentive you can take advantage of is to provide health insurance to early retirees between the ages of 55 and 64 because you may be eligible for federal financial assistance.
Healthcare reform will continue to trickle out until 2020. As the years have gone by since its inception, the Affordable Care Act has significantly decreased the number of uninsured Americans and continues to do so.
Do you have any questions about the Affordable Care Act?
If so, and they pertain to your business, you can easily connect with qualified attorneys on UpCounsel to address your business legal needs in regards to Affordable Care Act compliance and regulations today.