Affordable Care Act

The Affordable Care Act, otherwise known as Obamacare or the ACA, refers to the Patient Protection and Affordable Care Act. It is a federal law that was passed in 2010. The law enacted various changes to the American health insurance market, most notably within the market for privately purchased health insurance. However, its changes also extended to other spheres such as the small group health insurance market and also Medicaid. Among the notable features of the ACA are:

  • Premium subsidies for enrollees making between 100 percent and 400 percent of the Federal Poverty Level
  • Standardizing ACA health plan designs around 10 Essential Health Benefits
  • Fining Americans without qualifying health insurance with a fine (though the fine for individuals was reduced to $0 in 2019
  • Fining companies of 50 or more full-time equivalent workers if creditable health insurance is not provided by the employer
  • Expanding eligibility for Medicaid insurance, a government health benefits program targeting low income Americans
  • Prohibition on considering pre-existing health conditions in insurance application approval and premium setting
  • Adjusting premiums based on an individuals age, region of residence, tobacco use, subsidy eligibility, and coverage scope (individual, family)

The roll-out of Affordable Care Act health plans to the United States coincided with the launch of government sponsored health insurance marketplaces. These marketplaces are also known as “exchanges.”, which was created by the Federal government and used by dozens of states, is the most notable of these exchanges.