Signed into law by President Barack Obama in 2010, the Patient Protection and Affordable Care Act is responsible for the most sweeping reforms of the United States’ healthcare system since the 1965 passage of Medicare and Medicaid.
Hotly contested along party lines, Republicans opposed the Affordable Care Act, derisively using the term Obamacare to describe the Act. The controversy continues even after the ACA’s passage with numerous court challenges to the law.
What are the reforms?
Some of the reforms implemented by the Affordable Care Act include establishing Health Insurance Exchanges, or marketplaces, where individuals, families, and small businesses may purchase guaranteed issue qualified health insurance plans with affordable premiums. These plans satisfy the ACA’s individual mandate requiring those who don’t have health insurance buy a health insurance policy.
The ACA provides low-income purchasers with subsidies to make buying health insurance more affordable. At the same time, it imposes a tax penalty on those who remain uninsured once affordable health insurance is available through Health Insurance Exchanges.
The ACA prevents insurers from refusing to cover people with a preexisting condition, or from charging them higher premiums because of a preexisting condition. This reform is phased in over several years.
The ACA eliminates annual and lifetime caps on how much an insurance company will pay for a policy holder’s covered healthcare, and limits out-of-pocket maximums. It also eliminates copayments, deductibles, and coinsurance for basic preventive care services.
Some parts of the Affordable Care Act won't be implemented
Two parts of the ACA will never be implemented. The Supreme Court disallowed a provision that would have withdrawn federal Medicaid funding to states that didn’t offer Medicaid to more people. Additionally, Congress repealed the long-term care provision of the ACA, known as the CLASS Act, in January 2013 after the Department of Health and Human Services determined it was unworkable.