HRMan Benefits' Blog


“Obamacare” and What It Means to You

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By: Michael Ojeda

We have all heard the term “Obamacare”; but what does this mean to the average Joe? In 2010, the Patient Protection and Affordable Care Act was signed into legislature. This act specified that every citizen must enroll in healthcare or face a fine by the government. This is expected to take effect in 2014. Americans do have the choice of which healthcare they use, whether it’s Medicare or Medicaid, through their employer, or a personal healthcare provider. There will also be a state-based health insurance exchange for those who normally cannot afford insurance.
Several changes have taken place on the act during the years. In 2010, small businesses received tax credits to cover up to 35% of their total employee premium payments; this will lead to an increase of 50% in 2014. This change also gave those who fell under the Medicare “donut hole” a rebate of $250. In 2011 they received 50% off brand name drugs and the “donut hole” will be completely eliminated in 2020. Children were also allowed to stay on their parent’s healthcare plans until they turn 26. New private plans were forced to cover preventive services, like checkups and vaccines, with no co-payments, and they are excluded from deductibles. Americans who were denied coverage for new plans have access to an external appeals process. If consumers became very ill, insurance companies were stopped from dropping their clients. They also were stopped from creating lifetime coverage limits. They could no longer deny coverage to children with pre-existing conditions, and the same will be true for adults by 2014.
More changes came about in 2011 regarding healthcare. Medicare-covered preventative services were excluded from deductibles and the co-pay was thrown out the window completely. Insurance companies must prove they spent at least 80% of the premium payments on medical services; this does not include expenses such as advertising and executive salaries. Insurance companies that can’t do this must give rebates to policy holders. Grants were also given to states so that they may force health insurance companies to provide justification for all rate increases. Additional funding was given to double the amount of nurses and doctors and also increase the number of community healthcare facilities.
A specific mandate in the act states that everyone must get health insurance or be penalized with a fine. This was ruled unconstitutional by the 11th Circuit Court of Appeal in Atlanta. It referenced that this individual mandate falls outside the authority of Congress to regulate interstate commerce. The Treasury Department petitioned the Supreme Court to hear the case. In June 28, 2012 (tomorrow) the court will decide to uphold the entire Obamacare act, strike the whole act down, or just get rid of the individual mandate.

This is a critical time regardless if you are for Obamacare, against it, or just the mandate itself.


Author: hrmanbenefits

Anderson Thornton Consultants is a full-service insurance brokerage and employee benefits management firm based in Tampa, Florida, servicing businesses all over the United States.

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