The Patient Protection and Affordable Care Act (ACA) is a federal health care law passed in 2010. This massive health reform law made profound changes in the regulation of health care and the health insurance marketplace. It is often called “Obamacare” since it was signed into law and championed by then-President Barack Obama. The overall goals of the ACA are reducing the cost of health insurance, giving consumers more options, and lowering the uninsured rate. The law tried to create a system that more equally shared the cost of insurance between the federal government, employers, individuals, and families. It also aims to prevent restrictive practices in the health care industry. Table of Contents: How Does Obamacare Work? Who Benefits From Obamacare Subsidies? What Is the Individual Mandate? Rights Granted by the ACA Rights for Those Who Have Health Insurance Does Obamacare Protect Me if I Am Undocumented? How do I Choose the Right Health Plan for My Needs? Is the ACA Still in Effect? How Does Obamacare Work? The main objective of Obamacare is to reduce medical costs in the U.S. To accomplish this, it included the requirement that nearly every American have health insurance coverage, subsidies for health insurance premiums, and new regulations to the health insurance industry. For those who do not have health insurance coverage provided by their employer, the ACA set up an online marketplace. In this marketplace (also referred to as “exchanges”), Americans choose from different health insurance plans that best suit their coverage needs. Who Benefits From Obamacare Subsidies? Obamacare subsidizes the premium costs of individual health insurance plans purchased on the online marketplace to help low-income Americans pay for their insurance. It also makes payments to health care providers in an attempt to keep deductibles relatively low. What Is the Individual Mandate? Initially, the ACA included a fine for those who did not maintain health insurance, whether through the individual insurance market or through their employer. This was known as an “individual mandate.” The reason for forcing everyone to buy a health plan was for the premiums of the young and healthy cover the health costs of those who are older and in poorer health. In 2017, Congress eliminated this fine. Rights Granted by the ACA The ACA and supporting regulations granted several new rights to when it comes to Americans and their health insurance. It prohibits insurance companies from: Canceling a policy when the policyholder becomes ill Denying coverage to individuals with preexisting conditions Offering different premium prices to people of the same age living in the same state Putting lifetime coverage limits in place The law also grants the following privileges to Americans: Children can remain covered by their parents’ health plan until their 26th birthday. People can shop for plans and sign up for coverage through state health insurance exchanges or a federal exchange when their state does not maintain their own marketplace. The registration period to buy health insurance typically runs from November 1 to December 15 of each year. Those with a household income of up to 133% of the federal poverty level now qualify for Medicaid. Due to a Supreme Court ruling, states can choose not to participate in this Medicaid expansion. Currently, states not participating are: Alabama, Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, South Dakota, Tennessee, Texas, Wisconsin, and Wyoming. Those with a household income of up to four times the federal poverty level can obtain subsidies to buy a health care coverage plan. These subsidies are delivered through tax credits. All health insurance plans now must cover certain essential health benefits, including pregnancy and maternity care, mental health, and preventive care such as physicals and mammograms. Rights for Those Who Already Have Health Insurance If you already have insurance, Obamacare protects you by: Requiring insurers to give you a summary of benefits Preventing insurers from canceling a plan in response to illness Covering essential health benefits like preventive health services at no cost You can choose any doctor within your plan’s network, and you can use any emergency services outside of your plan’s network. Before seeking medical care, it is important to verify that the doctor or health care professional of your choice is within your insurance network. You can appeal if your insurer denies you coverage of health services. Does Obamacare Protect Me if I am Undocumented? No. ACA protections only apply to those who are legally present in the United States. Undocumented immigrants cannot access Obamacare protections. Those protected by Deferred Action for Childhood Arrivals (“DACA”) are also not covered. In practice, this means that they cannot access low-cost health insurance through the health insurance marketplace. These people also do not qualify for health coverage through Medicaid or Medicare. According to the Department of Health and Human Services, people with the following immigration statuses are legally in the United States: U.S. citizens Legal permanent residents (green-card holders) Asylees, refugees, and Cuban and Haitian entrants Those on a temporary stay in the U.S. for humanitarian reasons or significant public benefit Battered spouses and their children and parents Victims of trafficking and their spouses, children, siblings, or parents Those in the U.S. under the Convention Against Torture (CAT) Those who have non-immigrant status, such as those with work visas, student visas, U visas, or T visas Those with temporary protected status (TPS) Those with deferred execution of deportation (DEED) Temporary legal residents How Do I Choose the Right Health Plan for My Needs? The intent of Obamacare is to make health care more affordable for everyone. Visit the federal health insurance marketplace to see if you qualify for free or low-cost coverage. The Marketplace offers four coverage options to help you compare: Bronze Silver Gold Platinum Bronze plans typically charge the lowest monthly premiums, which require you to pay more when you receive health care services. Platinum plans, by contrast, charge higher premiums, but will pay more money for you when you receive health care. For example, you may have to pay $600 per month for a platinum plan and $200 for a bronze plan. Although the platinum plan is more expensive, you will most likely have to pay less money each time you go to the doctor. So if you have appendicitis and you get a hospital bill for $30,000, the platinum plan will cover a larger portion of that bill. Is the ACA Still in Effect? Obamacare has faced several legal challenges and the constitutionality of the law has been before the U.S. Supreme Court multiple times. It has been speculated that the judges nominated by former President Donald Trump may declare it unconstitutional. However, through early 2021, the ACA remains in effect. The only thing that has been removed is the mandate to buy a health insurance policy.

Insurance Law

What Is Obamacare?

By Andrew Leonatti

Last updated May 18, 2021

The Patient Protection and Affordable Care Act (ACA) is a federal health care law passed in 2010. This massive health reform law made profound changes in the regulation of health care and the health insurance marketplace. It is often called “Obamacare” since it was signed into law and championed by then-President Barack Obama.

The overall goals of the ACA are reducing the cost of health insurance, giving consumers more options, and lowering the uninsured rate. The law tried to create a system that more equally shared the cost of insurance between the federal government, employers, individuals, and families. It also aims to prevent restrictive practices in the health care industry.

How Does Obamacare Work?

The main objective of Obamacare is to reduce medical costs in the U.S. To accomplish this, it included the requirement that nearly every American have health insurance coverage, subsidies for health insurance premiums, and new regulations to the health insurance industry.

For those who do not have health insurance coverage provided by their employer, the ACA set up an online marketplace. In this marketplace (also referred to as “exchanges”), Americans choose from different health insurance plans that best suit their coverage needs.

Who Benefits From Obamacare Subsidies?

Obamacare subsidizes the premium costs of individual health insurance plans purchased on the online marketplace to help low-income Americans pay for their insurance. It also makes payments to health care providers in an attempt to keep deductibles relatively low.

What Is the Individual Mandate?

Initially, the ACA included a fine for those who did not maintain health insurance, whether through the individual insurance market or through their employer. This was known as an “individual mandate.” The reason for forcing everyone to buy a health plan was for the premiums of the young and healthy cover the health costs of those who are older and in poorer health. In 2017, Congress eliminated this fine.

Rights Granted by the ACA

The ACA and supporting regulations granted several new rights to when it comes to Americans and their health insurance. It prohibits insurance companies from:

Canceling a policy when the policyholder becomes ill
Denying coverage to individuals with preexisting conditions
Offering different premium prices to people of the same age living in the same state
Putting lifetime coverage limits in place

The law also grants the following privileges to Americans:

Children can remain covered by their parents’ health plan until their 26th birthday.
People can shop for plans and sign up for coverage through state health insurance exchanges or a federal exchange when their state does not maintain their own marketplace. The registration period to buy health insurance typically runs from November 1 to December 15 of each year.
Those with a household income of up to 133% of the federal poverty level now qualify for Medicaid. Due to a Supreme Court ruling, states can choose not to participate in this Medicaid expansion. Currently, states not participating are: Alabama, Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, South Dakota, Tennessee, Texas, Wisconsin, and Wyoming.
Those with a household income of up to four times the federal poverty level can obtain subsidies to buy a health care coverage plan. These subsidies are delivered through tax credits.
All health insurance plans now must cover certain essential health benefits, including pregnancy and maternity care, mental health, and preventive care such as physicals and mammograms.

Rights for Those Who Already Have Health Insurance

If you already have insurance, Obamacare protects you by:

Requiring insurers to give you a summary of benefits
Preventing insurers from canceling a plan in response to illness
Covering essential health benefits like preventive health services at no cost

You can choose any doctor within your plan’s network, and you can use any emergency services outside of your plan’s network. Before seeking medical care, it is important to verify that the doctor or health care professional of your choice is within your insurance network.

You can appeal if your insurer denies you coverage of health services.

Does Obamacare Protect Me if I am Undocumented?

No. ACA protections only apply to those who are legally present in the United States. Undocumented immigrants cannot access Obamacare protections. Those protected by Deferred Action for Childhood Arrivals (“DACA”) are also not covered. In practice, this means that they cannot access low-cost health insurance through the health insurance marketplace. These people also do not qualify for health coverage through Medicaid or Medicare.

According to the Department of Health and Human Services, people with the following immigration statuses are legally in the United States:

U.S. citizens
Legal permanent residents (green-card holders)
Asylees, refugees, and Cuban and Haitian entrants
Those on a temporary stay in the U.S. for humanitarian reasons or significant public benefit
Battered spouses and their children and parents
Victims of trafficking and their spouses, children, siblings, or parents
Those in the U.S. under the Convention Against Torture (CAT)
Those who have non-immigrant status, such as those with work visas, student visas, U visas, or T visas
Those with temporary protected status (TPS)
Those with deferred execution of deportation (DEED)
Temporary legal residents

How Do I Choose the Right Health Plan for My Needs?

The intent of Obamacare is to make health care more affordable for everyone. Visit the federal health insurance marketplace to see if you qualify for free or low-cost coverage.

The Marketplace offers four coverage options to help you compare:

Bronze
Silver
Gold
Platinum

Bronze plans typically charge the lowest monthly premiums, which require you to pay more when you receive health care services. Platinum plans, by contrast, charge higher premiums, but will pay more money for you when you receive health care.

For example, you may have to pay $600 per month for a platinum plan and $200 for a bronze plan. Although the platinum plan is more expensive, you will most likely have to pay less money each time you go to the doctor. So if you have appendicitis and you get a hospital bill for $30,000, the platinum plan will cover a larger portion of that bill.

Is the ACA Still in Effect?

Obamacare has faced several legal challenges and the constitutionality of the law has been before the U.S. Supreme Court multiple times. It has been speculated that the judges nominated by former President Donald Trump may declare it unconstitutional. However, through early 2021, the ACA remains in effect. The only thing that has been removed is the mandate to buy a health insurance policy.