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When Does the New Affordable Health Care Plan Go into Effect?
|Last Updated: 09/04/2012 09:02 AM
The Affordable Care Act, widely known as Obamacare, is a set of laws intended to make healthcare available to people who either cannot afford health insurance or are not insurable under traditional health insurance procedures. Since being passed into law in 2010, the laws have been progressively taking effect, and will continue to do so for the next several years. To get an idea of what the laws will do, it will be necessary to look at the laws as individual processes.
- Coverage for young adults is expanded. Small businesses, which traditionally paid as much as 18% more than larger businesses for health insurance, will begin to receive tax credits to offset the costs of providing coverage to their employees.
- States begin to receive additional federal-matching funds to cover more low-income individuals and families under Medicaid.
- Prescription rebate checks sent out to 4 million seniors who had reached the gap in Medicare prescription drug coverage known as the doughnut hole.
- Acceptance of preexisting conditions begins. Compliance is mandatory by 2014.
- The new law invests resources and requires new screening procedures for healthcare providers to reduce fraud and waste in Medicare, Medicaid and CHIP.
- Up until the new insurance exchanges will make coverage plans more affordable for early retirees, employers will be required to continue to provide coverage to people who retire between the ages of 55 and 65, as well as their spouses and dependents.
- The ACA creates a new easy to use website where consumers can compare health insurance options and pick the coverage that works best for them. (http://www.healthcare.gov/law/)
- All new health plans must include free preventive care, such as cancer and diabetes screenings.
- Consumer protections begin, including the ability to have a dispute with your insurance company heard by a third party.
- Lifetime limits on health coverages are eliminated, preventing insurance companies from dropping you because you have reached a preset spending limit for medical care. This includes annual limits as well as lifetime limits.
- Insurance companies are now held accountable for unreasonable rate hikes.
- The 80/20 rule prevents insurers from spending more than 20% of the premiums they receive for non-healthcare costs such as advertising, payroll or executive bonuses, and other overhead.
- To strengthen the availability of primary care, new incentives will expend the number of primary care doctors, nurses and physician assistants especially in underserved areas.
- Establishing consumer assistance programs begins. This is the first step in creating health insurance exchanges, which begins in 2014.
- Strengthen Community Health Centers, allowing these centers to serve 20 million more patients across the country.
- Increased payments for rural health facilities to promote better care in areas which have traditionally had trouble attracting sufficient services.
- The cost of prescription medications for seniors will be offset by discounts of up to 50% for medications that fall under the "donut hole" exclusions of traditional Medicare coverage. The discounts are also available for low-income persons and their families.
- The 80/20 rule is modified to be 85/15 for large corporations. Insurance companies which do not comply must begin issuing refunds to policy holders.
- Medicare overpayments are addressed, reducing the costs associated with providing Medicare Advantage by as much as $1000 per person enrolled in the program.
- Establishment of the Center for Medicare & Medicaid Innovation, which will look for new ways and technologies to increase the efficiency and reach of health care.
- Senior hospital readmissions will be reduced by implementing the Community Care Transitions Program, designed to increase the level of post-hospitalization care in order to reduce hospitalization costs.
- The Independent Payment Advisory Board will address the issue of Medicare in an attempt to extend its usefulness at least until the year 2029.
- The Community First Choice Option will allow states to implement home health practices, reducing the current dependence on nursing homes and assisted living facilities.
- Formation of Accountable Care Organizations began on January first. This allows care givers to form organizations for the exchange of information and reduce costs.
- To reduce "health disparities," federally funded health organizations will collect and report racial, ethnic and language data in order to provide better care where it is needed most.
- In October efforts will begin to bring healthcare administration into the digital age begins with legislation that is aimed at requiring health organization to use electronic and digital technologies to make health information and transferable patient records more accessible when and where they are needed.
- A Value Based Payment (VBP) system will also go into effect in October. This system offers payment incentives to hospitals which provide better care and record-keeping, with a focus on heart attacks, heart failure, pneumonia, surgical care, health-care associated infections, and patients' perception of care.
- New incentives will be offered to increase preventive care for Medicaid recipients. The purpose of this legislation is to reach patients who need care before the need becomes critical, thereby reducing the overall costs of treatment, as well as improving the care a Medicaid patient receives.
- Increasing the payments made to doctors who accept Medicaid and Medicare patients is meant to provide incentives for more caregiver to accept a wider range of patients. This portion of the law is a federally funded program.
- Bundling patient bills will also begin in 2013. This requires caregivers to bill patients a group billing rather than the current "fragmented" system where each physician or caregiver bills the patient separately.
- The Children's Health Insurance Program (CHIP) will receive additional funding. This program, which has been used by many states for years, attempts to reach and provide care for children who would otherwise have no health insurance options.
- The creation of Affordable Insurance Exchanges will officially begin. In practice many states have already begun forming health insurance exchange, but the law does not make them mandatory until 2014. Health insurance exchanges will be the "one-stop shopping" portion of the ACA, allowing consumer to shop for and research insurance companies.
- Individual responsibility becomes effective. This means that individual s are responsible for acquiring health insurance, or they will be penalized by the IRS. This is the portion of the ACA which is referred to as a tax, although it will have no effect on those who carry health insurance.
- Another method of getting coverage to more Americans is to allow workers to use the portion of the premiums their employer would pay through an employer-sponsored health plan in the purchase of alternate coverage plans from health insurance exchanges. The idea is to provide less expensive health insurance while increasing the options available to consumers.
- Earnings of $14,000 for an individual and $29,000 for a family will qualify for Medicaid enrollment. The purpose is to provide health insurance availability to those who make 133% of the poverty level, or less.
- For those who make 134% to 400% of the poverty level, the ACA provides for vouchers that will offset the cost of health insurance. This portion of the law is designed to increase health coverage for middle income families who may not otherwise be able to afford coverage.
- Insurance companies will no longer be allowed to drop or otherwise penalize people who participate in clinical trials, such as experimental cancer treatments or other life-threatening conditions.
- Eliminating annual limits on health coverage will become mandatory in 2014.
- Prohibiting insurance companies from denying coverage due to preexisting conditions will become mandatory.
- Tax credits for small businesses, designed to offset the traditionally higher rates they pay, will become mandatory. 2015
- Physicians who receive payments from the government will receive pay based on the value of services rather than the number of patients they serve.
Beyond 2015, the laws and regulations defined in the Affordable Care Plan will become effective. By 2020, all of the topics of the law will be mandatory and would have been implemented by the government, caregivers and health insurance providers. There are not currently any new changes that occur after 2015, but many of the regulations have mandatory compliance times during the years from 2015-2020.
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