Quick Facts on Upcoming Affordable Care Act

Michael Kites wrote a good summary of an article in Forbes that is worth sharing: Five Quick And Important Facts On Health Insurance Through Obamacare

“Although the new health insurance rules under the Affordable Care Act take effect in 2014 – barely more than 6 months away – there is still a lot of confusion about how it will all work. The reality is that health insurance will still be purchased the way it is now – through large employers, small employers, as individual coverage, or through public programs (e.g., Medicare/Medicaid). The big differences are that large employers must offer coverage or pay a fine (though many will likely choose the latter because it’s actually cheaper), and that if clients can’t get coverage through an employer they must be able to get it through a health insurance exchange. The exchanges will offer standardized policies (easy to compare) with premiums that adjust based on four (and only four) factors: age, rating area (think geographic cost-of-living adjustment), number of people in the family, and tobacco use. Notably, nothing about health status is part of the new rules, and the exchanges will not be able to adjust premiums, limit coverage, or exclude pre-existing conditions in 2014 and beyond. Of course, while the new rules ensure access to health insurance coverage, it still has a cost, which may not be trivial, but is a lot cheaper than paying for a serious sickness or injury, and there will be premium assistance for the nearly 67% of the population that makes less than 400% of the poverty level (and Medicaid will be available for those earning less than 138% of the poverty level). Premiums for individual coverage when it becomes available on the exchanges will change in a lot of states when the new rules kick in, though states that already have an active and well-regulated individual insurance market may not see a lot of increases. The health insurance exchanges will open for individual coverage on October 1.”