After years of debate and political posturing, the first, very visible signs of the Patient Protection and Affordable Care Act -- also known as Obamacare -- are scheduled to go into effect.
The act was signed into law in 2010 and upheld by the U.S. Supreme Court two years later. Although many of the reforms contained in the bill have already gone into effect, Oct. 1 has served as the flashpoint for proponents of the new law, as well as its detractors.
Beginning Oct. 1, some of the most sweeping changes in U.S. health care go into effect. Millions of Americans not covered by individual policies or employer-sponsored insurance will be eligible -- and mandated -- to tap into a health insurance marketplace and purchase health care coverage as will small businesses.
The U.S. Department of Health and Human Services estimates nearly 1.3 million uninsured Illinois residents may qualify for lower costs on coverage through the new insurance marketplace, which will be known as the exchange.
In Indiana, the number is expected to be about 861,000 uninsured and eligible individuals who may qualify for tax credits to purchase coverage in the exchange.
Some of those previously denied coverage under Medicaid might also qualify now. For these individuals, coverage is no longer optional.
Those who will likely benefit first are families that earn $32,000 per year or less per year and for whom health insurance has been an unaffordable luxury. They should now be able to purchase what the government is promoting as affordable health insurance through the Exchange.
Other benefits include:
- Coverage for young adults under their parents’ health insurance until their 26th birthday.
- Eliminating discrimination for pre-existing conditions.
- Eliminating lifetime insurance limits for cancer survivors and those who have chronic diseases.
- Eliminating co-pays for preventive services.
- Increasing affordability for prescription drugs for seniors.
Other, lesser known requirements will force insurance companies to prove they spend at least 80 cents of every premium dollar on health care or improvements to care. Insureds will receive refunds for the amount insurance companies underspend on care and overspend on administration.
The new law also seeks to stabilize insurance costs by forcing companies to publicly disclose how they will spend premium increases greater than 10 percent. Already the percentage of companies requesting premium increases have dropped from 75 percent to 14 percent, saving Americans an estimated $1 billion in premiums.
What is going to ultimately make Affordable Care work – as it has been proposed – will be the number of young people who opt in. In insurance, the key is balancing the number of those who will purchase insurance that be used minimally against those whose health care needs cost more than what they pay in premiums.
That group is overwhelmingly believed to be young adults age 18-34 -- an estimated 19 million young Americans -- who might decide they would rather pay a fine than opt in to the system. If this becomes the case, the system will be underfunded and we will go back to the drawing board.