With the Supreme Court's ruling on the Affordable Care Act, the new health care law will continue to be implemented over time. Many Americans will now be insured, whether they want to be or not.
Preexisting Conditions
One of the changes in the health insurance law is that those who have a pre-existing condition are now able to get traditional health insurance (this is called “guaranteed issue”. Also, children under 19 cannot be denied benefits because they have a pre-existing condition. There are also restrictions on the rates that insurance companies can charge for those with preexisting conditions.
Tax Penalties for Not Having Insurance
Those who choose to not have individual health insurance will be able to do so, but they will have to pay a tax penalty. The purpose of levying more taxes on those who do not get health insurance is to prevent certain individuals from refraining from buying health insurance, but burdening the system when they get sick. The penalty for not getting health insurance is either $285 per family ($95 for an individual) or 1 percent of the household’s income, whichever is greater. This mandate will begin in 2014 and will increase to $2,085 by 2016.
Insurance Exchanges
States are asked to set up insurance exchanges, and the federal government will set up exchanges for them if the individual states do not do it themselves. People are able to buy traditional health insurance, with a very comprehensive package of benefits, through these exchanges. Those who have incomes that are within a certain range of the poverty level will be able to qualify to get federal subsidies. It is unclear at this point how expensive the exchange products will be for those individuals who don’t qualify for subsidies.
Expanded Medicare
Those who earn below the poverty level would not be eligible for the subsidy but might qualify for their state’s Medicaid program. Individual states are able to expand their Medicaid programs but are not forced to do so.
Businesses Forced to Provide Health Insurance
Businesses will be forced to provide health insurance if they have at least 50 full-time workers. This mandate is designed to prevent employers from using the exchange to provide employees with healthcare. Employers who do not follow the mandate will receive a $2,000 fine per worker who does not receive health insurance.
Beginning in 2014, businesses of at least 50 full-time employees must offer affordable health insurance. Those employers subject to this requirement that don’t offer affordable coverage to employees, and one or more of those employees qualifies for an exchange subsidy, will face complicated and expensive penalties. Many employers are already responding to this expensive new requirement by cutting full-time employees to part-time status, or requiring greater cost-sharing by employees in the company health care plan. The reaction of employers to this new mandate will be one of the most discussed and debated provisions of the new law, and many workers may find their work-sponsored health coverage affected.
