Affordable Care Act (ACA), more commonly known as Obamacare, is the federal assistance program that came into force after the signature of President Barack Obama of law on March 23, 2010. This is a major milestone in the American healthcare system. More than 35 million people in 2022 are enrolled in this federal healthcare assistance program.
Obamacare made it mandatory for everyone to have health insurance coverage. The federal assistance of this healthcare law was to provide compensation to those families who could not afford health insurance completely. Thereby, it is a form of subsidy provided by the Federal Government to cover the deficit for health insurance. Want to get to the bottom of Obamacare health assistance? Keep scrolling down for more information.
Setting Up the Trap (Key Points)
- Obamacare, or Affordable Care Act (ACA), was enacted by President Barack Obama on March 23, 2010. Previously, it was known as the Patient Protection and Affordable Care Act (PPACA).
- This healthcare law made it mandatory for Americans to have health insurance plans.
- It provided federal assistance to cover the costs of health insurance at subsidized rates.
- Obamacare had a tax penalty for those who did not get a health insurance plan. It was termed an individual mandate.
- Trump administration repealed the tax penalty of the individual mandate in 2017, and it is still in effect.
- This healthcare law helps low-income families pay for their health insurance expenses every month.
- The subsidies of Obamacare are known as “Tax Credits.”
- These subsidies were increased by the Biden administration on March 11, 2021, by signing American Rescue Plan Act (ARPA) to include more people in the healthcare benefits. Resultantly, enrollment reached more than 35 million.
- According to ARPA, people with income ranging from 100% to 150% of the federal poverty level (FPL) can qualify for zero-premium silver plans.
- The premium subsidies may vary from plan to plan and state to state.
- Obamacare restricts insurance companies, and they cannot refuse coverage. It applies to a wide range of medical conditions.
- The Obamacare Open Enrollment Period (OEP) happens twice a year. One starting from the month of November till December. In contrast, the second OEP is in the first month (January) of the next year.
Obamacare Working Pattern: The Individual Mandate
Originally, the Obamacare healthcare law stated that every individual must have a health insurance plan. The individual mandate of ACA states that there is a tax penalty for those persons who do not get a health insurance plan. This healthcare law will only benefit those who have health insurance as it provides subsidized rates for covering health insurance packages.
However, this clause of the individual mandate was repealed by President Donald Trump in the tax bill of 2017, and it is still in effect in 2022. Thereby, there is no taxation penalty for those individuals who do not have a health insurance plan for themselves.
However, few states such as California, Hawaii, Connecticut, Maryland, Rhode Island, Washington, and Minnesota have their mandates for availing of Obamacare. Therefore, if you are a resident of any one of these states, you should check with your local laws to ascertain the mandates accordingly. Regardless, in most states, individual mandate stands repealed.
Subsidies Of Obamacare or ACA Law
In order to enroll in the Obamacare healthcare benefits program, you first have to get premium health insurance. The eligibility for ACA is to lie in a certain range of income according to the federal poverty line (FPL) as a benchmark. It is to be noted that ACA healthcare assistance is a subsidy that will help low-income individuals in covering their monthly premium insurance. These subsidies are commonly referred to as tax credits.
President Joe Biden signed American Rescue Plan Act (ARPA) on March 11, 2021, to increase the subsidies previously provided by the Obamacare health benefits. ARPA amendments are still intact in 2022. The subsidies were increased by the Biden administration to attract more enrollments in the ACA federal assistance.
Eligibility Criterion for Obamacare
According to the original rules and regulations of Obamacare, people earning more than 400% of the federal poverty line (FPL) were not included in the plan. Those under 400 % of FPL are eligible for nearly the same subsidies. However, the amendments made by the Biden administration have revised and increased the scope of eligibility.
According to ARPA law, people with income levels lying in the range of 100% to 150% of FPL will get zero-premium silver plans. The zero-premium silver plans offer the highest subsidies to the persons belonging to the lowest income sector.
Furthermore, ARPA law has also increased the subsidies for individuals falling in the category of 150% to 400% of FPL. As discussed earlier, Americans having an income of more than 400% of FPL were not eligible for Obamacare. However, the ARPA law by the Biden administration has set the premium restrictions to 8.5% of the income for those falling in this income-bracket category.
It is to be kept in consideration that the subsidy provided by Obamacare federal assistance will vary according to your health insurance and your state, as some states still follow the mandated formula.
Open Enrollment Period (OEP) Of Obamacare
OEP is a time frame that is very important to be remembered if you wish to enroll in the Obamacare plan. Open Enrollment Period (OEP) is the time in the year when the federal government takes applications for enrollment in ACA federal assistance.
Generally, OEP happens twice a year. The first enrollment of the program is in the month of January. The second enrollment of ACA starts in the month of November and ends in December. However, the dates are not fixed, and you should regularly check with the health department to get the exact dates of enrollment.
Apart from these two-time frames, you will not be able to enroll in Obamacare federal assistance program. Therefore, keep a look out for the dates of application to apply for this program.
Obamacare Coverage
This federal health assistance program covers a wide range of health conditions. Notably, it will provide subsidies to low-income individuals to meet their expenses on health insurance. Following are the key areas that Obamacare covers.
- Emergency Care
- Outpatient Care
- Hospitalization
- Preventive Care
- Pregnancy and Newborn Care
- Mental Health
- Substance Use Disorders
- Rehabilitation
- Laboratory Tests
- Pediatric Care
Conclusion
Obamacare is the greatest milestone in the American healthcare system. It has been in operation since its enactment in 2010 by the then President Obama. A few amendments were made by the Trump administration in 2017 to curtail the tax penalty imposed on those who don’t have health insurance.
Furthermore, the Biden administration increased the subsidies and relaxed the eligibility criterion for Obamacare in 2021, which is still in force. The general eligibility for this program is that you first need to have a health insurance plan. The federal assistance of Obamacare provides subsidies on health insurance plans. Furthermore, you also have to check eligibility in terms of the federal poverty line (FPL).
The persons having income in the range of 100% to 150% of FPL get the zero-premium silver plans. These plans offer the highest subsidies. Apart from the eligibility, it is also important to remember the Open Enrollment Period of Obamacare, which is twice a year. The initial enrollment is in the month of January, and the second phase is from November to December.
Apart from these OEPs, you cannot apply for Obamacare federal assistance. Therefore, keep these points in mind while applying for this healthcare assistance program.