The Affordable Care Act of 2010. March 2010. President Obama signed into law, creating: Patient Protection and Affordable Care Act (Public Law 111-148) Health Care and Education Reconciliation Act of 2010 (Public Law 111-152 )
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March 2010 President Obama signed into law, creating: • Patient Protection and Affordable Care Act (Public Law 111-148) • Health Care and Education Reconciliation Act of 2010 (Public Law 111-152 ) • Together, commonly known as The Affordable Care Act (ACA) of 2010
Basic Issues the ACA was designed to Address • In 2009 some 50 million Americans had no health insurance • Very unusual among Western nations, and among all developed nations. • Many people with health insurance faced rising premiums and were in plans that provided only limited yearly and/or lifetime coverage. • Insurance companies routinely denied coverage to people with serious illnesses, and often canceled plans over technicalities when people became sick. • Health care service was plagued with duplications, inefficiencies and unnecessary costs. • Costs were skyrocketing
Overview The Affordable Care Act (ACA) of 2010: • Impacts many areas of health care • Result of many compromises • Does not go into effect all at once • Relies heavily on state and local implementation, and private insurance
Overview Affordable Care Act is designed to make major changes in 4 basic areas: • Insurance company accountability • Lowering costs, improving the quality of health care and improving patient health • Increasing access and choice • Patient rights and consumer protections
Summary • Promote Primary Care and Prevention • Reform Health Insurance Market • a. They must cover everyone • b. No yearly or lifetime limit on benefits or coverage • c. No rescission—tricks to kick people off • d. Required minimum benefits • Yearly limit on out-of-pocket costs
Summary • Expand Medicaid to everyone under 65 with incomes below 133% of the FPL • Health Exchanges-using the market to control costs • Insurance premium subsidies for those under 400% of FPL • Individual Mandate
Summary • National effectiveness and quality standards and models. In policy this is called model or best practices. • Financed by: • Reductions in Medicare and Medicaid payouts. • Fees on insurance companies, drug makers, medical devices, tanning services
Summary • New tax on high income earners • New tax on unearned income to support Medicaid • Tax on Cadillac plans • CBO: will reduce deficit by $124 billion over ten years
The Timeline How Timeline Works: Changes take effect over many years, through 2020 Timeline shows when major reforms go into effect Designed to give more detailed information about changes coming soon, summarizes changes down the road
Timeline: In Progress Now Pre-existing Condition Insurance Plans Who: People who can’t get insurance because of pre-existing medical conditions, including mental health conditions Why: Before ACA, people with pre-existing conditions often couldn’t get any insurance
Timeline: In Progress Now Pre-existing Condition Insurance Plans What: People who can’t get insurance because of pre-existing medical conditions can apply for a Pre-Existing Condition Insurance Plan (PCIP) Law limits premiums to “standard rates” - the average amount private insurers in the state charge for premiums for similar coverage Limits out-of-pocket expenses • $5,950/year for individual (does not include premiums)
Timeline: In Progress Now Pre-existing Condition Insurance Plans What: • States can run PCIPs, with federal funding, or use the federal program • 29 states chose to run plans themselves • 21 states chose to let the federal government run them • PCIPs in each state operate under ACA standards • But plans may vary from state to state
Timeline: In Progress Now Pre-existing Condition Insurance Plans What: For people who live in states where the PCIP is run by the federal government, there are now three options for plans: • Standard plan • Extended plan • Health savings account plan The federal PCIP will now offer a special child-only rate for children under 18.
Timeline: In Progress Now Pre-existing Condition Insurance Plans How: To apply for a PCIP you must: • Be a U.S. citizen or lawfully present in the United States • Have had no health coverage for the last 6 months • Have a pre-existing condition, as defined by each PCIP • You can apply no matter what your income is
Timeline: In Progress Now Pre-existing Condition Insurance Plans When: • PCIPs are meant to be temporary: • End on January 1, 2014, when insurance companies won’t be allowed to deny people coverage because of pre-existing conditions • On January 1, 2014, the state-run health insurance Exchanges will be operational.
Timeline: In Progress Now Money Follows the Person Grants Who: • People on Medicaid who need long-term care services Why: • Money Follows the Person grants provide flexible funding that lets a person who needs long-term care services obtain services that are most appropriate to what they need and want • MFP funding gives flexibility to move from institutional to community-based services and keep funding
Timeline: In Progress Now Money Follows the Person Grants What: ACA extends these grants and adds $2.25 billion in funding Broadens eligibility standards Helps states pay for the costs of moving someone from institution to home When: MFP grants have been extended until September 2016 How: The program is continuing to operate as before
Timeline: In Progress NowRescission Outlawed Who: • Anyone who has insurance and might get sick Why: • Before ACA, when someone with insurance got sick with an expensive or chronic illness, insurance companies would often go back and search their application for mistakes, looking for reason to drop their coverage • This is called rescission, and happened to thousands of Americans each year
Timeline: In Progress Now Rescission over Sickness Outlawed What: • Under ACA, insurance companies aren’t allowed to drop people’s coverage because they get sick When: • Rescission is now illegal How: • Department of Health and Human Services is responsible for regulation and enforcement details
Timeline: In Progress Now Ban on Discriminating Against Kids with PEC Who: • Children under 19 with pre-existing conditions Why: • Before ACA, insurance companies could legally deny insurance to children because they had a pre-existing condition What: • Under ACA, it is illegal for insurance companies to deny or restrict insurance to children because of pre-existing condition
Timeline: In Progress Now Expanded Coverage for Young Adults Who: • Adult children up to age 26 Why: • Before ACA, children were often dropped from parents’ insurance plans when they turned 18 or finished college • Many young people have difficulty finding jobs with employer-sponsored coverage and can’t afford to buy individual coverage, so they often would go without insurance
Timeline: In Progress Now Expanded Coverage for Young Adults What: • Children can stay on (or be added to) their parents’ insurance until they turn 26 • Applies to plans that offer dependent coverage When: • Open enrollment for coverage started on September 23, 2010.
Timeline: In Progress Now Ban on Lifetime Coverage Limits Who: • Anyone who has insurance or will ever use insurance Why: • In the past, insurance companies have used lifetime coverage limits to limit amount of money they will pay out for a customer’s health care needs • If someone got sick and reached their lifetime coverage limit during treatment, the insurance company could just stop paying for treatment
Timeline: In Progress Now Ban on Lifetime Coverage Limits What: • Insurance companies not allowed to put caps on amount they will spend on lifetime coverage costs for essential benefits • Essential benefits include things like hospital stays, doctor visits, and prescription drugs
Timeline: In Progress Now Ban on Lifetime Coverage Limits When: • Ban started September 23, 2010, for all new individual insurance plans and all group plans • Annual limits are restricted in all group plans and new individual plans, until 2014, when banned completely How: • The law includes a detailed list of essential benefits that must be covered without limit
Timeline: In Progress Now Free Preventive Services - Private Coverage Who: • Anyone who has private insurance Why: • Before ACA, many health plans charged for preventive services, so people often chose to skip them • Preventive services can help avoid many costly health problems down the road
Timeline: In Progress Now Free Preventive Services - Private Coverage What: • Private insurance plans have to cover certain recommended preventive services, like cancer screenings • Insurance companies are required to offer these services free to patient - without deductible, coinsurance, or copayment charges • Law ensures many free preventive health services for children, including many vaccines
Timeline: In Progress Now Free Preventive Services - Private Coverage When: • All new individual and group plans after September 23, 2010 How: • Coverage for these services is offered through existing private insurance plans
Timeline: In Progress Now Improvements to Medicaid HCBS Who: People who use Medicaid’s Home and Community-Based Services (HCBS) Why: In 2005, 1915(i) was added to Social Security Act Gave state Medicaid programs option to provide HCBS to people with disabilities before they need institutional care Many states did not choose to provide these services