What are my rights and protections under the Affordable Care Act?

The main objective of the Patient Protection and Affordable Care Act was to provide quality, affordable health insurance coverage to all Americans. The law calls for coverage to be more fair to the consumer and easier for you to understand.

Key provisions beginning in 2014

The key provisions begin to take place in 2014. Some parts apply to individual and small business plans and some apply to all types of health insurance coverage.

Here are some examples:

1) Exchanges (sometimes called marketplaces) will be created to make securing coverage simple and easy.

2) You cannot be turned away or charged more premium because of pre-existing conditions.

3) You should be informed about your coverage options in an easy-to-understand way.

4) Health insurance companies have to justify premium increases.

5) It is illegal for a health insurance company to cancel your health insurance because you get sick.

6) Protects your right for choosing your doctor.

7) Children up to age 26 can be covered on his/her parent's health insurance regardless of marital or student status.

8) Access to free preventive care.

9) No lifetime benefit maximums or annual limits on essential health benefits, so you can't run out of insurance for those services

10) You have a right to appeal insurance decisions.

Did my state expand Medicaid?

The Health Reform law calls for the expansion of Medicaid to include more people.

Historically, if your income was 100% Federal Poverty Level (FPL) or lower, you would qualify for Medicaid.

Varies state-to-state

Medicaid is run on the state-level, so qualifying varied state-to-state. For example, some states did not offer Medicaid to young adults who were not pregnant or who had not recently given birth even if you met the income requirement.

The Health Reform law expanded Medicaid to include household incomes up to 138% FPL.

But again, it can vary depending on where you live. Some states chose not to expand Medicaid due to costs.

You can visit our State Decisions page to see whether your state expanded Medicaid or visit Medicaid.gov for more information or to apply for Medicaid in your state.

When Medicaid isn't an option

If you would have qualified for the Medicaid expansion, but your state did not expand the program, then you can qualify for reduced premiums or out-of-pocket plans through a new health plan purchased through an exchange. The premiums are based on a sliding scale to keep them affordable for you.

Did my state establish an exchange? What does that mean for me?

What is an exchange?

An exchange, also called a marketplace, is one place where you can view your coverage options, compare plans side-by-side and enroll online. An exchange simplifies your choices and provides you with information about how the Health Reform law affects you, your family or your business.

Qualifying for lower premiums or out-of-pocket expenses starting in 2014

Based on household income, you might qualify for lower premiums or lower out-of-pocket costs on a new plan in 2014. You'll have four choices (Platinum, Gold, Silver, Bronze and a 5th 'catastrophic' plan choice for some) that are sold by private insurance companies competing for your business. Premiums are based on a sliding scale to keep them affordable for you.

Did all states set up an exchange?

No, some states chose not to establish an exchange. Twenty-six states did not. And six more states are still trying to decide if they want to establish an exchange or not. By setting up an exchange, the state assumes control and administration of the exchange, but it also assumes the costs associated with the exchange, too.

What if my state did not establish an exchange?

If your state did not establish an exchange, you will use the federal exchange instead if you qualify for reduced premiums or out-of-pocket costs. And to you, it shouldn't feel any different. You'll be still able to choose between four plans (platinum, gold, silver, bronze) sold by private insurance companies competing for your business. 

Visit our State Decisions page to see what your state decided to do about the exchange. 

When do changes occur?

The Patient Protection and Affordable Care Act (often called "Health Reform Law" or "Obamacare") was passed in 2010. The law called for parts to be implemented over several years. The key provisions begin in 2014 with a couple of provisions being delayed until 2015.

Visit the Health Reform Timeline to see when each change is scheduled to begin.

"I heard the Health Reform law was delayed... What does that mean for me?"

You're right that parts of the Health Reform law have been delayed.

1. The Employer Mandate has been delayed. In everyday language, that is the requirement that businesses with 50 or more employees must offer affordable health insurance to their employees or pay a penalty. The penalties have been delayed until 2015 to give businesses time to adjust their plans to be compliant. However, keep in mind that the reporting, employee notifications, and additional taxes to that size employer have not been delayed. 

2. The out-of-pocket maximum has been delayed. In everyday language, the law says that an individual's out-of-pocket expenses cannot be more than $6,350 a year. That total includes that you pay for including things like office visit copays or prescription copays. That part of the law has been delayed until 2015.  

The rest of the law is scheduled to proceed on time.

10 Things you need to know about the Health Reform law

1. Millions of individuals and businesses will be securing insurance through an exchange starting in 2014.

An exchange is just a fancy word for a website that shows you all your benefit options in one place, compares plans side-by-side, and allows you to enroll online.

There are public (government) and private (private sector) exchanges. Exchanges should also provide education on Health Reform, how the law affects you or your business, and help you determine if you qualify for any subsidies (like discounts) or tax credits.

2. Starting January 1, 2014, there is an individual requirement to have health insurance.

You must have health insurance or pay a penalty unless you qualify for an exception. If you don't have access to an affordable job-based insurance plan or a government-sponsored plan, you can enroll in individual or family health insurance during Open Enrollment.

This year's Open Enrollment is October 1, 2013 - March 31, 2014. In 2015 and beyond, the Open Enrollment will be October 1st - December 31st.

3. If your household income is less than 400% Federal Poverty Level (about $96,000 a year for a family of four), then you will qualify for some level of tax subsidy toward the purchase of an individual health insurance plan starting in 2014.

A good way to think of a tax subsidy is a "discount" that reduces your premium or out-of-pocket expenses on things like deductibles or copays. You can only use your subsidy if you do not have access to an affordable job-based insurance plan, either through your job or your spouse/partner's job.  

4. If you qualify based on family size and household income, you can apply your subsidy toward four plans offered through an exchange.

There are four plan choices: platinum, gold, silver, bronze. If you are less than 30 years old, you have a fifth "catastrophic plan" option. These plans will be issued by brand-name insurance companies (like BluecCross BlueShield, Humana, United Healthcare, Kaiser, etc.) who are competing for your business. 

These same plan options are available for private policies that are not paid subsidized by the government.

5. The law divides businesses into two categories: Small and Large.

Small businesses have less than 50 full-time equivalent employees. Large businesses have 50 or more full-time equivalent employees.

A full-time equivalent employee is a true employee of your business (not 1099), generally receiving a W2, who works 30 or more hours per week and at least 120 days per year.

If you are Self-Employed (business of one), you are not considered "an employer" under the Health Reform law, and will shop for Individual and Family policies instead of business policies. 

6. Large businesses are required to offer affordable health insurance to their employees or pay a penalty. 

Not offering: The penalty is $2,000 per employee per year. There is a waiver on the first 30 employees.

So, for example, if you have 52 employees, you would pay zero penalty for the first 30, $2,000 penalty for the last 22 employees, or a $44,000 penalty per year. This part of the law has been delayed until 2015.

Not affordable: What the employee pays toward employee-only health insurance cannot exceed 9 1/2% of his/her Modified Adjusted Gross Income (This does not consider what he/she pays toward spouse or children's coverage).

If it's not affordable and one employee qualifies for a subsidized individual plan, the business will pay a penalty of $3,000 per employee. This part of the law has been delayed until 2015.

7. Small businesses are not required to offer health insurance to their employees, but can choose to offer benefits. 

Because of price, underwriting rules (see #9), and administration, many small businesses might offer individual policies to employees instead of a business plan. That way, the group won't have to worry about participation, contribution, and on and off-boarding rules that apply to business plans.

Or, by offering group health insurance to your employees, you might qualify for a Small Business Healthcare Tax Credit. This credit is for businesses with less than 25 employees (the highest credit to businesses with less than 10) who pay at least half of the employee premium and have an average income of less than $50,000 per year. 

8. All individual and small business policies issued on or after January 1, 2014 must include a set of Essential Health Benefits - with no yearly or lifetime limits so you can never run out of insurance for core care:

ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health, substance abuse, and behavioral health, prescription drugs, rehabilitative and habilitative services and devices, laboratory services, preventive and wellness services and chronic disease management, and pediatric services including dental and vision care for children under the age of 19.

9. There are many changes to how individual and small business policies are underwritten and priced.

No health insurance company can turn you away or charge you extra premium because of health history, pre-existing conditions, how often you use your plan, gender, or profession.

All pre-existing conditions and Essential Health Benefits (including pregnancy, preventive care, and more) are covered.

The gap between what the youngest and oldest pay for health insurance has to shrink to a 1:3 ratio (generally, that means younger will be paying more than before and older will be paying less than before so they meet in the middle).

The only thing considered in your rate is age, zip code, and tobacco usage.

10. You can keep the plan you have now. 

If you want to keep the plan now, you can. Unless your plan is grandfathered, it will be adjusted sometime in 2014 to become compliant with the new Health Reform law. Some insurance companies are adjusting that rate January 1st, and some are giving you the option to lock-in 2013's rate for all of 2014.

Generally speaking, those individuals and small businesses who see the advantages of today's rating system (younger, male, preferred health, non-rated industry) might see a big increase once those advantages go away in 2014 under ACA.

However, those individuals and businesses who are at a disadvantage in today's system (paying high premiums because older, female, pre-existing conditions, high claims, rated industry) might see a big decrease once the insurance companies can no longer penalize them for those things in 2014.

Another factor to consider is whether you qualify for subsidy, which reduces your healthcare costs. You can only qualify for subsidy during Open Enrollment (this year, October 1 - March 31). 

It's a good idea to partner with a Health Reform expert to see if it's best for you to keep your current plan or get a new ACA-compliant plan.

What is an exchange (and it's many aliases)?

An exchange is really just a fancy word for a website that shows you all your benefit options in one place, compares plans and price side-by-side, and allows you to enroll online. An exchange should also provide education on Health Reform and help you determine if you qualify for any discounts or programs under the new law.

Think of an exchange like an online supermarket for benefits. You'll browse through low-cost plan options, pick out what you like, and add them to your shopping cart. It makes shopping for benefits simple and easy.

Two types of exchanges

There are two types of exchanges: public and private.

A public exchange is run by the government. Some states set up an exchange and some states did not. For the states who did not, they will use the federal exchange instead. To the consumer, it shouldn't feel any different. You'll still be shopping for the same plans issued by private insurance companies competing for your business.

How the exchange helps

If you do not have access to an affordable health plan through your job, you might qualify for lower premiums and lower out-of-pocket costs by purchasing a health policy through the exchange.

If your household income is less than 400% Federal Poverty Level (for a family of four, that's around $96,000 a year), then you'll qualify for some level of tax subsidy.

An easy way to think of a tax subsidy is like a discount off the cost of your health insurance premium. You might also qualify for lower deductibles and other out-of-pocket expenses.

A private exchange can offer the same plans that a public exchange does, as well as other health insurance choices. A private exchange can also offer products like dental, vision, life and more in addition to health insurance.

No health insurance company can turn you away or charge you extra premium because of pre-exisiting conditions, health history, claims, gender, or industry. Pre-exisiting conditions and pregnancy are always covered.

Plan Choices

You can choose from four plans: Platinum, Gold, Silver or Bronze. You can apply your tax subsidy, or "discount", toward any of those plans. If you are under the age of 30, you have a fifth catastrophic plan choice to keep the costs even lower.

The exchange plans are sold by private insurance companies like BlueCross, United Healthcare, Humana, etc. that are all competing for your business.