Affordable Care Act (ACA) GOVT 2306, Module 12

Goals of Healthcare Reform Control costs Improve outcomes Cover uninsured

COST Before ACA

Cost AFTER ACA

Health Insurance Coverage

Coverage

Insurance Reform Insurance companies will no longer be able to refuse coverage based on pre-existing conditions or to drop coverage of people who become ill. Companies can no longer impose lifetime coverage limits. Young people can stay on their parents’ insurance until age 26.

Business mandate Businesses with 50 or more workers must provide health insurance coverage for their employees or pay a fine to the government. Small businesses can receive tax credits to help cover the cost of insuring their employees.

Medicaid Expansion The ACA expands Medicaid to cover childless adults earning at least 133 percent of the federal poverty level ($31,721 for a family of four in 2014, $15,282 for a single person), adding 10 million to 14 million people to Medicaid rolls. Although the federal government will initially pay the entire cost of the additional enrollees, state governments will be required to pick up 5 percent of the extra cost in 2017, 7 percent by 2019, and then 10 percent from 2020 going forward.

Individual Mandate Most people who are not already covered will be required to purchase a health insurance policy or pay an additional tax. Families earning less than four times the federal poverty level, which was $94,200 a year in 2013 ($23,550 for a single person), qualify for federal financial assistance to help them cover the cost.

Mandate

Insurance Exchanges State governments were to set up health insurance exchanges, online marketplaces where businesses and individuals can shop for insurance policies. The exchanges allow insurance companies to compete for customers by providing quality products at affordable prices. Undocumented immigrants will not be able to purchase from the exchanges even if they pay entirely with their own money.

Insurance Exchanges by State Many states, including Texas, have refused to operate insurance exchanges.

Coverage Nearly a million Texans have received covered through the federal health insurance exchange. Roughly 86 percent qualified for subsidies averaging $242 a month.

Medicaid Expansion Healthcare reform expands Medicaid to cover childless adults earning at least 133 percent of the federal poverty level ($31,322 for a family of four in 2013), adding 10 million to 14 million people to Medicaid rolls nationwide, including 1.2 million Texans.

Texas would benefit financially from healthcare reform. Cost to Texas The federal government will pick up the entire cost of the new enrollees for the first three years, injecting $3.7 billion healthcare dollars annually into the Texas economy. Subsequently, the state share will gradually rise until 2020 when Texas will be required to cover 10 percent of the cost, an estimated $370 million, which is less than 1 percent of the state budget. Texas would benefit financially from healthcare reform.

Cost of Medicaid Expansion

Medicaid Expansion by State

What You Have Learned What are the goals of the Affordable Care Act (ACA)? How effectively has it achieved its goals? Is the ACA popular? What are the main features of the Affordable Care Act? How has Texas implemented the ACA?