The law is being phased in over several years, culminating in major changes in 2014. Here’s a progress report on what’s already in effect and what’s to come.
In effect now
Cheaper drugs in Medicare
Seniors with Medicare Part D drug plans who have reached the “doughnut hole”—the point when they must start paying prescription-drug expenses themselves—get a 50 percent discount on covered brand-name drugs and a 7 percent discount on generic drugs (14 percent in 2012).
Insurers must allow young adults to stay on their parents’ plan until they turn 26 unless they can get coverage through their own employer. An estimated 1.2 million people are taking advantage of that benefit in 2011.
Help for early retirees
Almost 6,000 companies have signed up to receive subsidies to help them retain their early-retiree (pre-65) health insurance programs. The government had dispensed $2.7 billion to the companies as of June 2011, preserving coverage for 4.5 million 55- to 64-year-olds and their family members.
Coverage for some with pre-existing conditions
About 27,000 previously uninsured adults with pre-existing medical conditions had gained coverage in state-based “high risk” insurance pools established by the law as of June 2011. And an estimated 162,000 children have gotten insurance under another provision that bars insurers from denying coverage to children younger than 19 because of a pre-existing condition.
Free preventive care
Some 18.9 million people on Medicare have now received one or more free preventive health services, such as screening tests for diabetes, heart disease, and breast or cervical cancer in women, prostate cancer in men, and colon cancer in people of either gender. New private-insurance plans must also cover the full cost of those preventive services.
Coming in 2012
Insurers will have to give rebates if they spend too much of their revenue on administrative or other business costs instead of actual medical expenses. For large job-based plans, medical expenses should total 85 percent; for small-business and individual plans, 80 percent. The Obama administration estimates that up to 9 million people could get rebates starting in 2012, totaling up to $1.4 billion.
Clear plan descriptions
Insurers will have to describe each plan using a standardized form. It will include information on premiums, co-pays, coinsurance, and deductibles, and estimates of out-of-pocket costs for typical medical situations, such as having a baby or treating diabetes.
2014—Major reforms go fully into effect
This “individual mandate” is the subject of legal challenges and will almost certainly end up before the Supreme Court. It requires you to have health insurance if you are a U.S. citizen or legal resident. People who don’t get insurance from work, on their own, or through a public program such as Medicare, Medicaid, or the Children’s Health Insurance Program (CHIP) will be subject to a tax penalty, starting at $95 per person in 2014 and increasing steadily after that. You’ll be able to appeal the penalty based on financial hardship, and other parts of the law will make it easier to obtain affordable coverage.
Access for all
Insurers will no longer be allowed to reject applicants or charge them higher premiums because of a pre-existing condition. That will be possible because the risk of high claims for those who are seriously ill will be spread among many more people, thanks to the millions of newly insured people brought in by the individual mandate.
“Pay or play” for large employers
Companies with more than 50 full-time workers will have to offer their employees affordable health insurance or pay a penalty.
States will create centralized insurance “exchanges,” marketplaces where individuals and small businesses can compare and buy private health plans. All plans that are sold in the exchanges must offer a comprehensive set of benefits.
Families and individuals who meet income requirements will get subsidies in the form of reduced premiums and out-of-pocket costs for coverage bought through the exchanges. The subsidies will be available for families who earn up to almost $90,000.
All individuals and families with an income of up to 133 percent of the federal poverty level will qualify for Medicaid. That will be a major expansion of coverage.