Key Features of the Law

Health Insurance Exchanges

One of the most important features of the Affordable Care Act is the establishment of the Health Insurance Exchanges. These Exchanges are online supermarkets, similar to Travelocity and Expedia, that will allow consumers to purchase affordable health insurance and easily compare health insurance plans. The law calls for two types of Health Insurance Exchanges: individual and small business health options programs (SHOP). Individual Exchanges will be open to U.S. citizens and legal residents. SHOP will be open to small business owners with fewer than 100 employees. States have the option to set up their own exchanges or they can choose to allow the federal government to operate the exchange for them. For states that choose to have the federal government run their exchange, consumers will use healthcare.gov to purchase their insurance. 

For more information on Health Insurance Exchanges, click these links:

Federal Health Insurance Marketplace - Healthcare.gov

What is a Health Insurance Exchange? - Kaiser Family Foundation

Health Insurance Improvements

Under the Affordable Care Act, many improvements have already been made in how health insurance is delivered and administered by insurance companies.

  • Young adults under the age of 26 can stay on their parents' health insurance plan.
  • Children with pre-exisiting conditions can no longer be denied health insurance! Starting in 2014, adults will no longer be denied access to health insurance. Until then, adults with pre-existing conditions can get health coverage through the Pre-exisiting Condition Insurance Plan (PCIP).
  • Insurance companies are now required to spend 80 percent of health insurance premiums on healthcare costs and administrative expenses. If an insurance company doesn't follow this rule, the company will be required to give a rebate to its customers.
  • Insurance companies who want to raise the costs of their premiums by more than 10 percent will be required to explain why they want to increase their prices. The government will review the rate increase to determine whether or not the rate increase is reasonable.

Medicaid

Medicaid is a state managed insurance program that covers low income families, children, the elderly and people with disabilities. In the coming years, the Affordable Care Act will make some changes to the Medicaid system.

  • Beginning in 2014, states may choose to expand their Medicaid programs to include citizens and legal residents under the age of 65 with an income that is below 133% of the federal poverty level. Unfortunately, as of January 2014, Mississippi is not participating in the optional Medicaid expansion program. 
  • The Affordable Care Act will temporarily increase Medicaid payments for primary care services.
  • The Affordable Care Act will help states that choose to participate in the Medicaid expansion program cover 100% of the costs associated with administering the program between 2014-2016. 

For more information on how Medicaid will grow under the Affordable Care Act, click these links:

Affordable Care Act - Medicaid.gov

Medicare

Medicare is a health insurance program for people aged 65 and older and for people under age 65 with certain disabilities. The Affordable Care Act has also changed some provisions within Medicare.

  • The Medicare Trust Fund has been extended. This law makes a $350 million investment to Medicare, Medicaid, and the Children’s Health Insurance Program.
  • The law also provides more coverage to seniors:
    • Some preventative services, such as annual wellness exams, are cost-sharing free.
    • Medicare recipients received a $250 prescription drug rebate in 2010
    • 50% discount on brand-name drugs in the donut hole in 2011
    • Closes the donut hole by 2020

For more information on Medicare and the Affordable Care Act, visit these links:

AARP Health Law Guide

How does the Affordable Care Act affect Medicare?

Children's Health Insurance Program (CHIP)

CHIP is a low cost health insurance plan for children and their families who earn too much to apply for coverage by Medicaid but not enough to afford private health insurance.

  • The Affordable Care Act requires CHIP to continue until 2019.
  • The federal government will help states pay for costs associated with CHIP by paying 23 percent more to states managing the program.

Check out this fact sheet from Families USA - How Health Reform Helps Low Income Children