Patient Protection and Affordability Act

Often referred to as Obamacare, the Patient Protection and Affordability Act was a groundbreaking piece of legislation to reform the American healthcare system. Its main goals were to increase the number of people with healthcare insurance, improve the quality and efficiency of health services, and reduce healthcare costs.

Will My Work Be Affected by the 2016 Changes?

Work for a small business with fewer than 50 full-time equivalent employees. You may have more options to purchase affordable health insurance through the Small Business Health Options Program (SHOP) exchange, a marketplace where small employers can compare and buy health plans for their workers.

The ACA has increased the tax credits and subsidies available to small employers and their employees participating in the SHOP exchange, making the coverage more affordable and attractive. The ACA has also eliminated some barriers and restrictions that previously prevented some small businesses from offering health insurance to their workers, such as minimum participation rates and rating variations based on health status or gender.

If you work for a large business with 50 or more full-time equivalent employees, you may be required to have health insurance or pay a penalty unless you qualify for an exemption. This is because the ACA has implemented the employer mandate, which requires large employers to offer affordable and adequate health insurance to their full-time workers and their dependents or face a tax penalty if any of their workers receive subsidies on the individual exchange.

The employer mandate was originally scheduled to take effect in 2014, but it was delayed until 2016 for employers with 50 to 99 employees and until 2017 for employers with 100 or more employees. The ACA has also introduced the Cadillac tax, a 40% excise tax on high-cost employer-sponsored health plans exceeding certain thresholds ($10,800 for individual coverage and $29,500 for family coverage in 2023). The Cadillac tax was supposed to take effect in 2018, but it was postponed until 2023 by Congress.

Work as an independent contractor, a freelancer, a self-employed person, or a gig worker. You may have more access to affordable health insurance through the individual exchange. In this marketplace, eligible individuals can purchase private health plans and receive subsidies based on income and household size.

The ACA has expanded the eligibility and generosity of the subsidies, making the coverage more affordable and accessible for many people who do not have access to employer-sponsored insurance or other public programs. The ACA has also eliminated some barriers and restrictions that previously prevented some individuals from buying health insurance on the individual market, such as pre-existing condition exclusions, lifetime and annual limits, and rating variations based on health status or gender.

What Is the Individual Mandate?

The individual mandate was designed to encourage people who were healthy and unlikely to buy health insurance to sign up for coverage, thus creating a larger and more balanced pool of insured people that would lower the premiums and out-of-pocket costs for everyone.

However, the individual mandate was also controversial and faced legal challenges from those who argued that the government should not be able to force people to buy something they did not want or need. In 2012, the Supreme Court upheld the individual mandate’s constitutionality, ruling that it was a valid exercise of Congress’s power to tax. However, in 2017, Congress passed a tax reform bill that reduced the penalty for not having health insurance to $0, eliminating the individual mandate starting in 2019. Since then, some states have created their mandates with their own penalties, while others have not.

What Is the Employer Mandate?

The employer mandate is a provision of Obamacare that requires certain employers to offer health insurance to their full-time employees and dependents or pay a penalty to the IRS. The mandate applies to employers with 50 or more full-time employees or equivalent employees in the previous calendar year. The employer mandate is sometimes called “the pay or play provision” of the ACA.

The employer mandate has two main requirements for employers:

• Offer minimum essential coverage that is affordable and provides minimum value to at least 95% of their full-time employees and their dependents, or pay a penalty of $2,700 per full-time employee (minus the first 30) in 2023 if any full-time employees receive subsidies on the individual exchange. This is known as the “A penalty” or the “sledgehammer penalty.”
• Offer minimum essential coverage that meets the affordability and minimum value standards to all their full-time employees and their dependents, or pay a penalty of $4,060 per full-time employee who receives subsidies on the individual exchange in 2023. This is known as the “B penalty” or the “tack hammer penalty.”

The employer mandate also has some exceptions and exemptions for certain employers, such as small businesses, religious organizations, tribal entities, and seasonal workers.

What Is the Contraceptive Mandate?

The contraceptive mandate is a government regulation or law that requires health insurers or employers to provide their employees with health insurance to cover some contraceptive costs in their health insurance plans.

The contraceptive mandate covers 20 types of contraceptives that are approved by the Food and Drug Administration (FDA), including birth control pills, patches, rings, shots, implants, IUDs, emergency contraception, and sterilization. These contraceptives are considered preventive health services and must be provided without any co-payment, deductible, or coinsurance by the insurers or employers.

However, the contraceptive mandate has also been controversial and faced legal challenges from some religious organizations and employers who objected to providing or paying for contraceptives that they considered immoral or against their beliefs. The Supreme Court has ruled on several cases involving the contraceptive mandate and has granted some exemptions and accommodations for certain employers and employees with religious or moral objections to the mandate.

How Does the Ban on Pre-Existing Condition Discrimination Work?

The ban on pre-existing condition discrimination is a provision of Obamacare that prevents health insurers from denying or charging more for coverage to people who have health problems that existed before they applied for insurance. These health problems are called pre-existing conditions and can include chronic diseases, pregnancy, or mental illness.

Before the ACA, health insurers could use medical underwriting to evaluate applicants’ health status and decide whether to offer them coverage, what benefits to include, and how much to charge. This meant that many people with pre-existing conditions were either rejected for insurance, offered plans that excluded their conditions, or charged higher premiums and deductibles. This made it difficult for them to access affordable and adequate health care.

The law specifically cites discrimination as prohibited for health insurers when considering pre-existing conditions when they sell or renew health plans in the individual and group markets. This means that health insurers must offer coverage to everyone who applies, regardless of their health history, and cannot vary the benefits or prices based on health status. The only factors health insurers can use to set premiums are age, geographic location, family size, and tobacco use.

The ban on pre-existing condition discrimination applies to most health plans, including those sold through the Health Insurance Marketplace, employer-sponsored plans, and Medicaid expansion. However, some plans, such as grandfathered, short-term, and association health plans, may not have to follow this rule. Therefore, it is important to check the details of any plan before enrolling.

The ban on pre-existing condition discrimination is one of the most popular and important features of the ACA, as it protects millions of Americans who have or may develop health problems from being denied or priced out of health insurance. It also helps create a larger and more balanced pool of insured people, lowering overall costs and risks for everyone.

Do I Need a Lawyer If I Can’t Meet The Mandate?

If you find yourself unable to meet the individual mandate’s requirements or face penalties you believe are unjust, it might be wise to consult with a lawyer. They can guide you through the intricacies of the mandate and help you understand your rights and possible exemptions.

Do I Need a Lawyer If I Am Being Denied Insurance or Contraceptives?

Absolutely. If an insurance company is unlawfully denying you coverage, especially concerning contraceptives or based on pre-existing conditions, a lawyer can be your ally. Understanding your rights and having professional representation can make all the difference in such scenarios.

Looking for more advice or believe you’re being unfairly treated under the Patient Protection and Affordability Act? Connect with a knowledgeable insurance lawyer through LegalMatch today.