Understanding Obamacare (without the Apocalyptic Naysayers)

You can demonize the Affordable Care Act (Obamacare) all you want. But it’s now the law of the land, so we might as well try to understand it. That was the attitude in a recent article published in the AARP magazine, which outlined the benefits (at least to seniors) of Obamacare.

Your insurance may cost a little more under the Affordable Care Act, but it will also be much better and more extensive coverage than what you have now.

I decided to do additional research on the benefits of Obamacare. Most questions can be answered at HealthCare.gov, but there’s a gob of other helpful stuff out on the internet. Here’s what I found.

Starting in 2014, all insurance plans must cover these “essential services”:

  • Emergency services.
  • Hospitalization.
  • Maternity and newborn care.
  • Ambulatory services.
  • Prescription drugs.
  • Lab services.
  • Rehabilitative services and devices.
  • Mental health and substance use disorder services.
  • Preventive and wellness services.
  • Chronic disease management.
  • Pediatric oral and vision care.

The law places much attention on prevention and primary care to help people stay healthy and to manage chronic medical conditions before they become more complex and costly. Too many people, lacking insurance or money, put off getting medical help until things get really bad–and by then, it’s far more costly and difficult to treat. Prevention could drastically reduce the nation’s medical costs.

All plans must cover a range of 50 preventative services, with no co-pay, coinsurance, or deductibles required:

  • Various immunizations.
  • Prostate exams.
  • Free annual physicals for seniors.
  • Screenings for blood pressure, cholesterol, colorectal cancer, diabetes, autism, breast and cervical cancer, and a number of other conditions.
  • Prenatal care is classified as a preventive service.

In addition, here are other aspects of Obamacare I found.

  • You have no annual or lifetime limits on how much insurers will pay. This will benefit people who require constant or expensive medical care because of an ongoing health condition (like children with congenital heart defects). This starts in 2014. No longer will people be forced into debt or bankruptcy because their coverage runs out.
  • You can’t be denied coverage because of pre-existing conditions.
  • You can’t be dropped from your plan if you get sick. This already applies to children, and will apply to all adults starting in January 2014.
  • Your insurance company can no longer use an unintentional mistake or minor omission on an application to cancel your coverage. In the past, insurance companies have used such errors as excuses to cancel your coverage, declare your policy invalid from the day it started, and even make you pay back any money they spent for your medical care. However, insurance companies can still cancel your coverage if you deliberately provide false or incomplete information on your application, or if you don’t pay your premiums on time.
  • Health plans must spend at least 80 cents of every dollar on health care rather than on administrative costs (like outlandish bonuses and salaries to CEOs). If they spend too much on overhead, they must issue rebates to consumers each summer.
  • Health plans must let young adults remain as dependents on their parent’s policy until they turn 26, regardless of whether they live at home, attend school, or are married.
  • Starting September 23, 2012, all health plans must use a standardized form to summarize benefits and coverage, including information on co-payments, deductibles, and out-of-pocket limits.
  • Plans in the new Marketplace will be offered by private companies. All must offer a core set of essential health benefits. You’ll be able to compare various plans to your work plan. However, if you choose a Marketplace plan, your employer doesn’t need to make contributions to your premiums. Enrollment begins in October 2013, and Marketplace coverage starts as soon as January 2, 2014.
  • Childbirth and newborn infant care are covered (they are excluded in two-thirds of individual plans).
  • Children under age 19 can get their teeth cleaned twice a year, and receive fillings and medically necessary orthodontia.
  • Children can get an eye exam and one pair of glases or contact lenses every year.
  • There is a cap on annual out-of-pocket medical and drug expenses up to an estimated $6,400 for individuals and $12,800 for families.
  • Emergency room visits don’t require preauthorization. You can’t be charged extra for visiting an ER out of your network.
  • The plan must cover hospitalization, though you may have to pay 20% of the bill if you haven’t reached your out-of-pocket limit.
  • Small businesses with fewer than 50 fulltime employees are not required to offer health insurance and face no penalties.
  • Small businesses with 50 or fewer fulltimers can get insurance through health benefit exchanges — and some of the smallest ones may be eligible for tax credits. Small businesses with low-wage employees may decide against providing health insurance, and instead encourage workers to buy coverage on the exchanges.
  • If your business doesn’t offer insurance, you can go online to Healthcare.gov to find a health plan that works for you and your family. All plans will be listed, with comparisons, in one place.
  • If your workplace insurance plan is very expensive, you can check the online exchanges to see if you can get a more affordable plan.
  • $350 million is being invested to fight medical fraud.
  • No longer will women be charged more for insurance than men (because of reproductive services).
  • Because of the shortage of primary care doctors (the “family physician”), and because the ACA will require more of them, the health law has begun to fund training for more primary care doctors and has increased support for community health centers.
  • As of January 1, 2014, Americans who can afford coverage will be required to purchase health insurance or pay a tax penalty.

Since 2003, the average premium for family coverage rose 80 percent — from $9,068 to $16,351. Without healthcare reform, costs would continue to skyrocket. As a result, fewer and fewer companies would offer health insurance, and an increasing number of low-income people would go without insurance. Whether the ACA is the answer–who knows? But something had to give. Obamacare certainly shows a lot of promise.

A report from the Rand Corp., released in August 2013, showed that fears about people having to pay a lot more under Obamacare are unfounded. The report says that firms employing fewer than 100 workers will pay almost 6 percent less in premiums in 2016. Nationally, the report said, average premiums for equal plans would cost $5,837 with Obamacare and $6,192 without it.

Medicare’s Board of Trustees says the Affordable Care Act will extend their solvency by 12 years, to 2029.

Each year about 40,000 people die prematurely because they lack health coverage. Many hundreds of thousands of people delay needed care and just try to get by. The ACA will put an end to that. Initially, because so many new people will gain coverage, there will probably be an extra large number of doctor visits, surgeries, etc., from people who have put it off. This, I understand, typically happens when a country begins national health care.

This year, medical costs will help bankrupt 650,000 American households — including many who thought they had decent insurance until diagnosed with a serious illness. Such bankruptcies will end (except, I imagine, in states which refuse to participate).

So that’s what I learned.

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