FAQ: the Patient Protection and Affordable Care Act
What is Obamacare?
"Obamacare" is what we've all apparently decided to call the Patient Protection and Affordable Care Act, a set of health reforms passed by the Congress and signed into law by President Barack Obama in March 2010.
The law itself touches on everything from how hospitals are reimbursed for care to whether chain restaurants post calorie counts on their menus. But, generally, by "Obamacare" most people mean the provisions of the law that relate to the efforts to insure about 30 million Americans through subsidized private insurance or government-provided Medicaid.
When is Obamacare?
Soon! Obamacare's insurance marketplaces - where people who don't get health insurance through Medicaid, Medicare or their employer will go to buy it - begin open enrollment on Tuesday. The law actually begins delivering insurance coverage, both through private plans bought on the marketplaces and through Medicaid, on Jan. 1.
Are you sure it will really start then?
Pretty sure. There have been some small delays in the functionality of different marketplaces. California, Connecticut, Hawaii, Idaho, Kentucky, Massachusetts, New Mexico, New York and Rhode Island are on track to launch new exchanges with all the intended functions on Tuesday. In the federally run marketplaces, small businesses won't be able to shop online until November. But overall, the law looks on track for New Year's Day.
Will Obamacare be available in every state?
Some of it will, some of it won't. The insurance marketplaces, and the subsidies that go along with them, will be available in every state and the District of Columbia. But the Medicaid expansion, which serves people making less than 133 percent of the federal poverty line ($31,322 for a family of four), was made optional by the Supreme Court. As of now, only 26 states are likely to participate in it come January.
What makes this particularly troublesome for the law (and, more to the point, for the uninsured) is that there are no subsidies for private insurance for people making less than the poverty line. So if you're poor and in a state that hasn't accepted the Medicaid expansion, you're out of luck.
Who gets insurance through the program?
Here's the biggest thing to know about Obamacare: Most people will never notice it.
If you get health insurance through your employer or the government - as 80 percent of Americans do - it's very unlikely that you'll interact with Obamacare's coverage expansion at all. (There are other provisions in Obamacare, like some of the efforts to improve care quality or cut health-care costs, that could affect you. But that's not the core of the law or the part that's starting Tuesday.)
Obamacare matters most for the 20 percent of Americans who are either uninsured or get insurance on the individual market. Anyone in those groups can get insurance through Obamacare. Those who make more than the federal poverty line but less than four times the poverty line ($94,200 for a family of four), can buy subsidized insurance on the marketplaces. Those making less than 133 percent of the poverty line and living in a state that has accepted the Medicaid expansion can get Medicaid.
The Congressional Budget Office expects that the Affordable Care Act will cover about 14 million of the uninsured in 2014 and 25 million by the end of the decade. That still leaves about 30 million people uninsured.
If I already have health insurance, do I have to care about this?
Probably not. The truth of Obamacare is that it mostly affects the uninsured and people who don't have employer-based or government-based health insurance. That's a relatively small fraction of the population, even though we often talk about the law as if it affects everyone.
How much are the premiums?
That will vary depending on the state you're in, your age, your health, your income, the kind of plan you want, etc. The fastest way to figure out your costs is to go to www.healthcare.gov.
What does it cover?
All insurance under Obamacare has to cover a set of health benefits the Obama administration has defined as "essential." They are "ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care."
How much will I pay out of pocket?
Depends. Out-of-pockets costs in Medicaid are almost nothing. In the insurance marketplaces, however, there are four levels of insurance coverage: bronze, silver, gold and platinum. These levels correspond to the amount of health costs they'll cover for the average applicant: 60 percent for bronze, 70 percent for silver, 80 percent for gold, 90 percent for platinum (there's also a bare-bones "catastrophic" option available to applicants younger than 30). The lower your level of coverage, the more you'll pay out of pocket.
But the law also has secondary out-of-pocket protections, including limits on out-of-pocket costs for lower-income families. The Kaiser Family Foundation's subsidy calculator will tell you if you qualify.
What if I have a preexisting condition?
Under Obamacare, it doesn't matter. This is one of the really big changes: Insurers won't be allowed to ask about your health or charge you more because of it. This is true for both plans sold on the new marketplaces and those sold outside of it.
What if I'm young and really, really healthy?
Congratulations! You're in the prime of your life - and may have heard that you're getting ripped off by the health-care law. Here's the deal: The health-care law limited the amount that insurers can charge really old people and that might lead them to bump up the rates for younger people. A lot of this will depend on where you live.
Where do I go to buy it?
Who can help me buy health insurance?
If you don't want to just sign up on your own, there are people who can help guide you through the process. You could go to the insurance brokers who sell health plans right now, typically receiving a commission for their work. The health-care law funds some new positions to provide similar help. Dubbed "navigators," these are people whose whole job is to explain the enrollment process. They do not receive a commission from the health plan for enrolling someone in coverage.
How hard will it be to sign up?
That's a little difficult to predict right now. What we do know is that anyone who wants to buy coverage will have to enter in basic information: their age, income, state of residence and family size. After that, if all goes as planned, shoppers will be able to compare different health plans.
Federal officials have found that, in the very best scenario, people will be able to buy coverage in just seven minutes. That's probably not the typical case, where someone will want to take time going over plan options. And there's also the possibility of glitches with information processing.
How long do I have to sign up?
You can buy health coverage on the marketplaces from Oct. 1 to March 31. After that, you're out of luck until the next enrollment period starts on Oct. 7, 2014. There are exceptions for people who experience a life-changing circumstance, such as moving to a new state or losing a job.
What if I don't want to buy insurance?
First off: Nobody will come knocking down your door, demanding that you purchase a health plan. But if you decide not to purchase coverage, you will have to pay a $95 tax penalty. This would be deducted from your 2015 tax return.
How will the government know if I have health insurance?
You'll have to tell them, via the taxes that you file for 2014. Starting then, the Internal Revenue Service will send out a form where you'll fill in the type of health plan you purchased (or note that you didn't purchase coverage). Employers might hand out pre-populated versions of these forms to make things easier.
Will the government track me down if I'm not insured?
This is a popular Obamacare myth, but the federal government is actually limited in what it can do to collect the tax penalty for not purchasing health coverage. It can't send agents to your door, nor can it put a lien on your house. The most they can do is take the fine out of your tax refund - or, if you're not getting a refund this year, put it on your tab for next year's refund.
What if I can't find an affordable plan? Do I still have to buy something?
No. Although it's the government, not you, who gets to decide what counts as "affordable." The health-care law says that if you can't find a plan that costs less than 8 percent of your income, then you're exempt from the requirement to purchase health insurance. This will, obviously, depend a lot on an individual's circumstances and not the sticker price of the plans sold on the marketplaces.
What if I get insurance through Obamacare and then I get a job that pays more money?
If your income changes, you're supposed to go back online and report that shift. Any federal help you get purchasing health insurance coverage will likely be adjusted to reflect your new income. The other option here is not to report your new income, although the government will figure it out when you file taxes the next year - and then look to recoup the tax credits you were not supposed to receive.
Was the individual mandate delayed?
It was not. While the White House did delay the requirement that large employers offer coverage to their workers, it did not touch the provision that says all individuals must carry health insurance coverage. That still takes effect on Jan. 1.
I own a small business. What does this mean for me?
A few things, starting with the new small-business health insurance marketplaces that open Oct. 1, where you could help your workers buy insurance coverage. Initially, the idea for these marketplaces was to have employers chip in a certain amount and then their employees could pick any health insurance plan they wanted.
The federal government had to delay that functionality for one year, though, because of technical problems. That means, in 2014, you will pick one plan for your workers to enroll in. Some states running their own marketplaces, however, will allow for full employee choice of any plans starting Tuesday.
How are the subsidies paid for? Are my taxes going up?
There are essentially two big funding streams for the Affordable Care Act. The first are cuts to Medicare reimbursements. We heard a lot about this during the presidential campaign, when Mitt Romney would talk about the law cutting $716 billion from Medicare. These are cuts largely to the rates that we pay doctors who see Medicare patients and also what we pay private insurers that cover these subscribers.
The other big funding source are taxes on different health-care industries such as hospitals, insurance companies and, more relevant in recent days, medical device makers. There's a debate about whether those taxes will get passed on to consumers, but, as it stands, they're not direct taxes on you as an individual.
There is one tax that is applied to some individuals, which began last year: The Affordable Care Act raised taxes on investment income for people who earn more than $200,000.
Where can I go for more information?
After Oct. 1, the best way to learn about what Obamacare does and doesn't mean for you is to go to HealthCare.gov and tool around. The Kaiser Family Foundation's subsidy calculator is also a good bet; go to http://kff.org/interactive/subsidy-calculator. For more of an overview of the law, the Kaiser Family Foundation's summary is excellent.
(c) 2013, The Washington Post