The Affordable Care Act (Obamacare) – What You Need to Know

Despite being in effect for eight years, many Americans still do not know that The Affordable Care Act and Obamacare are the same thing.

So, how does the Affordable Care Act (Obamacare) work?

You probably know The Affordable Care Act by its nickname Obamacare.  The law provides many benefits, not the least of which are subsidies to help pay for health insurance. Here is everything that you need to know about the Affordable Care Act (AKA Obamacare).

The Affordable Care Act (ACA) was passed into law in March of 2010. The law itself did not take effect until January 1, 2012. In fact, the first Open Enrollment using Healthcare.gov took place November 1 through December 15, 2012.

1: What are Preexisting Conditions?

Prior to 2012 health insurance companies could refuse to provide coverage to people who had health conditions. Even when they did provide coverage, the plan usually excluded any medical conditions that were considered to be preexisting conditions.

Most health insurance policies defined a pre-existing condition as:

A-1: A condition for which medical advice, diagnosis, care, treatment, diagnostic procedures, or further evaluation was recommended or received in the 24 months prior to the effective date of the policy.

Here is an example to help you understand this statement. You are healthy today and buy a health insurance policy. Six months later you are working in your garden and pull something in your back. Your doctor suggests surgery and you believe that you are covered. Sadly, the health insurance company denies the claim as a pre-existing condition.

Why? Because fifteen months earlier you went to the doctor for back pain and an MRI was done. At the time your doctor suggested two Advil every six hours. One week later you felt fine and had no other issues. That is until this new back problem which the insurance company is connecting to last year’s back problem.

A-2: A pre-existing condition is a condition which manifested itself in such a manner that an ordinary prudent person would have sought treatment.

This one is a little easier to understand. Assume that you found a lump under your right arm. Over the next six months you notice that this lump grows. Since you do not have health insurance and are worried about the lump you purchase a policy in the hopes that if it is a problem the insurance company will cover it.

Your lump is a pre-existing condition and will not be covered.

Under the Affordable Care Act health insurance companies can no longer exclude you or charge you a higher premium due to a pre-existing condition. Of course, you must enroll when you are eligible. I will discuss eligibility later in this article.

2: What Things Are Required to be Covered Under the Affordable Care Act (Obamacare)?

 To meet the requirements of the Affordable Care Act health insurance policies are required to cover the following benefits.

Outpatient ambulatory care that you receive regardless of whether you become hospitalized.

Emergency services, even when provided outside of your health insurance network. Insurance companies must treat all emergency care as in-network.

Hospitalizations.

Pregnancy, maternity, prenatal care, and well-baby care.

Birth control services

Prescription Drugs must be covered.

Rehabilitative and habilitative services that help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills.

Laboratory services

Preventive and wellness services. I will provide more information later in this article.

Chronic disease management

Pediatric oral and vision services as well routine medical services.

3: What Preventive and Wellness Services Are Covered Under the Affordable Care Act?

Under the Affordable Care Act (Obamacare), preventive services are generally covered without any copayment. Preventive services are divided by services for men, services for women and services for children.

For a complete list and explanation of these preventive services go to: https://www.healthcare.gov/coverage/preventive-care-benefits/

4: When is the Obamacare Annual Enrollment Period?

You can enroll or change plans during the annual “Open Enrollment” period. The open enrollment period runs November 1 through December 15 of each year. During open enrollment you can shop for a plan with a lower premium or a different deductible and you cannot be denied coverage.

In the absence of a qualifying event, you cannot buy or change your health insurance plan at any other time.

5: What Are Special Enrollment Periods?

There are certain life events that allow you to enroll or change your health insurance plan, regardless of medical conditions. If you qualify for a special enrollment you may have up to 120 days to enroll or make changes to your health insurance. Your 120 days includes the 60 days before and 60 days after the qualifying event.

Qualifying life events include:

  • Loss of Group Health Insurance: If you are losing your employer-based health insurance you have 120 days to enroll in a new health insurance policy. You can enroll 60 days prior to the cessation of coverage. After you lose your health insurance you also have 60 days to enroll in a new health plan. Choosing to drop your coverage does not qualify for a special enrollment period.
  • Loss of Marriage: If you are getting or have gotten married, you can enroll in a new plan or change your current plan. You will need to have the proper documentation to show the marriage took place.
  • Divorce, legal separation and loss of health insurance: In order to qualify for a special enrollment period under this category you must have actually lost insurance coverage. Simply getting divorced or legally separated does not qualify for a special enrollment.
  • Birth of a child, adoption or foster care: The addition of a child through natural birthing process, adoption or foster care is a qualifying life event. Your coverage can start the day of the birth or placement. Under this situation you can enroll in the plan even up to 60 days afterward.
  • Death: You qualify for a special enrollment period if someone on your Marketplace plan dies and you are no longer covered under your insurance plan due to the death.
  • Change in zip or change in county Moving to a new zip code or new county will qualify you for a special enrollment period.
  • Moving from a foreign country: If you have moved from a foreign country to the United States or a United States territory you may qualify for a special enrollment period.
  • Students: A student who has relocated and moved to/from a location may qualify for a special enrollment period.

5: How Do I Qualify for a Affordable Care Act (Obamacare) Premium Subsidy?

Perhaps the biggest benefit of the Affordable Care Act (Obamacare) is the premium subsidy. If you qualify, the federal government will help pay all or part of your monthly health insurance premium. In general, if your income is less than 400% of the federal poverty guideline you will receive a subsidy.

Imagine that you are a single male, age 40, and your annual income is $38,000. The federal poverty level for 2020 is $12,760. Since your income is less than 400% ($51,040) you will qualify for a subsidy. In this case you would qualify for a monthly subsidy of $137.

If your income was $25,000 annually, your subsidy would be $315 a month which would cover 100% of the premium for a high deductible health plan.

You are not required to use 100% of your subsidy. If you use less than the full amount you will receive the balance at year end when you file your taxes.

On the other hand, if you use the full amount and your income is higher than you estimated, you will have to pay back the excess subsidy.

 

6: I don’t make a lot of money. Why Don’t I qualify for a subsidy?

I often receive calls from people who think that they should qualify for a health insurance subsidy under the Affordable Care Act. And very often these same people fail to qualify. There are several reasons why you may not qualify for a subsidy.

  1. You declined the health insurance offered through your employer. If you share of the premium is less than 9.78% of your income you will not qualify for a subsidy.
  2. If you declined coverage offered through your spouse’s employer, that too will disqualify you for a health insurance subsidy.
  3. It is also possible to have an income that is too low to qualify for a health insurance subsidy. The Affordable Care Act included money to assist states in expanding Medicaid. Unfortunately, many states refused to take those funds and did not expand Medicaid. The result is that you can make too much money to qualify for Medicaid but not make enough money for a subsidy.

7: How Do I Apply for Obamacare Health Insurance?

If you qualify to enroll in a compliant health insurance, you have four options.

You can call the Healthcare Marketplace at 800-318-2596 and talk with one of their Navigators

You can go to https://healthccare.gov and enroll directly

You can call your local Department of Insurance and talk with a Navigator

The best option is to find a health insurance professional who is certified to work with the Marketplace and is licensed with the various insurance companies in your state.

DO NOT WORK WITH AN INSURANCE AGENT WHO IS NOT CERTIFIED BY HEALTCARE.GOV. The federal government requires health insurance agents to retrain annually. These agents understand all of the requirements of the Marketplace and are generally licensed with the health insurance companies that offer Marketplace policies.

In addition, these agents also have the capability to upload documents to the Marketplace on your behalf. And in most cases these agents can take your first premium if required.

If you have any questions feel free to send me an email at mel@myhealthcare360.org

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