Patient Protection and Affordable Care Act

The Patient Protection and Affordable Care Act

The Patient Protection and Affordable Care is a statute passed by the United State Congress on March 21, 2010, and signed into law on March 23, 2010 by United State President Barack Obama. The law was challenged all the way to the Supreme Court by many states within the U.S. as unconstitutional. On June 28, 2012 the United State Supreme Court passed a ruling upholding the law for the exception of the Medicaid Expansion portion which it provided the states autonomy and deciding whether to expanding Medicaid as a provision of the law. The Patient Protection and Affordable Care Act has many different un-official names that it is commonly referred by such as Obamacare, ACA, Health Care Reform, Health Care Law. The Patient Protection and Affordable Care represent the biggest change in the United States Health Care system since 1965 when Medicaid and Medicare was put in place.

Patient Protection and Affordable Care Act:Goals

The main goal of The Patient Protection and Affordable Care is to help decrease the number of Americans who do not have health insurance, as well as help reduce the overall cost of health care in the United States. The cost of health care in the United States has been increasing at a faster rate than inflation. The Patient Protection and Affordable Care also put in place many regulations to help protect the benefit and level of service individuals receive from their health care providers.

Patient Protection and Affordable Care Act: Provisions

The various provisions of The Patient Protection and Affordable Care will be phased in over a period of 10 years. The provisions of the law went in effect in 2010, and will continue through 2020. Below is a list of the main provisions of The Patient Protection and Affordable Care

Guaranteed Coverage:
This a requirement that everyone be issued a health insurance policy regardless of community rating, pre-existing medical conditions, or age. Policy providers cannot charge higher premium to any applicant with any of the previously stated conditions. Everyone within the same age group, and location must be charged the same premium.

Individual Mandate:
 This is a requirement that everyone must purchase health coverage. This is a requirement for all individuals that do not have an employer sponsored plan, Medicare, Medicaid, or any other state public health insurance program. If you do not purchase health coverage you will be charged a Health Insurance Tax

Health Insurance Exchange:
Each State will establish a state run health insurance exchange. A Health Insurance Exchange is market place for individuals and small business to purchase insurance . State also have the option of defaulting to the federal government to setup and manage one for the state.

Medicaid Expansion:
State that choose to partake in Medicaid Expansion will change the state Medicaid eligibility to offer Medicaid to anyone within 133%-400% of the federal poverty level.

Lifetime/Annual Caps Banned:
Health Insurance providers will no longer be able to set financial limits on the amount of payout for healthcare to their members on a lifetime, or annual basis.

Business Health Insurance Tax:
Companies with 50 or more employees with at least one full time employee must provide health insurance or pay a fine starting at the 31st employee. Please click her to read more on business taxes and the health care law

Preventative Services: 
Certain preventative services that will be considered “essential benefits” will be free of co-payments, co-insurance or deductibles.

Patient Protection and Affordable Care Act: Funding

The Patient Protection and Affordable Care: will be funded through a variety of channels including the Health Insurance Tax for individuals and families who forego health coverage, and Increase in Medicare Tax for incomes above $200,000, Excise tax on Medical supplies, and Cadillac plans, Tax on tanning, and reduction of various Medicare Advantage programs.

It is projected within the next ten years the following taxes will be increase to generate revenue.

  • Medicare tax rate increase  $210.2 billion
  • health insurance providers annual fee: $60 billion
  • 40% excise tax on health insurance Cadillac $32 billion
  • Annual fee on manufacturers and importers of branded drugs: $27 billion
  • Impose a 2.3% excise tax medical devices:$20 billion
  • medical expenses deduction to 10%: $15.2 billion
  • Limit FSA/HAS Contributions to $2,500: $13 billion
  • All other revenue sources: $14.9 billion


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