As of January 2014, the Affordable Care Act (ACA) requires that all American citizens have health insurance. For the majority of Americans already insured, you will likely either keep what you have or have the chance to change it to almost any plan you want through the Health Insurance Marketplace.
However, some groups will be affected differently by the ACA. Medicaid and Medicare members may see expanded coverage provided by the ACA. Elsewhere, those who are uninsured will need to purchase insurance to comply with the new law.
Being Uninsured Will Cost You
The ACA does require most people to have health insurance—including those who don’t currently have insurance. As of January 2014, individuals—with some exception—who are without health insurance will be required to pay a special tax. For 2014, that will cost either $95 or 1 percent of taxable income per adult, whichever is greater. The tax will increase each year as follows:
- 2015: $325 or 2 percent of taxable income per adult, whichever is greater
- 2016: $695 or 2.5 percent of taxable income, whichever is greater
- 2017 and beyond: the tax penalty will increase annually based on cost-of-living increases
The tax for a child is half the adult tax.
Medicaid Receives Extra Funding
The impact of the ACA on Medicaid coverage depends on what state you live in. While the Supreme Court ruled in favor of the health care law for the most part, it did allow individual states the choice to opt out of expanding their Medicaid coverage.
For those who live in Illinois, here’s what to expect:
- Increased funding for the Children’s Health Insurance Program (CHIP). States will get two more years of funding to provide health services for low-income families with children who are not eligible for Medicaid.
- Incentives for providers to coordinate and improve patient care by “bundling” their pay. Under a pilot program, hospitals, doctors and other providers who work together to perform a surgical procedure, for example, would receive a flat rate payment that covers the entire hospital stay, rather than payment to a roster of providers. This is meant to improve efficiency and quality.
- Increased Medicaid payments for primary care physicians. Primary care doctors who treat Medicaid patients would receive the same rates they get for treating Medicare patients.
- Improved preventive health coverage. New funding will be available to state Medicaid programs that have chosen to cover preventive services for consumers for free or at highly discounted rates.
These changes help to improve the overall care you will receive under Medicaid.
Medicare Makes Improvements
If you use Medicare for insurance you will not need to do anything. As the ACA takes effect you can rest assured that if you are enrolled in Medicare, your choices and benefits won’t change. This is true whether you are a member through the original Medicare program or a Medicare Advantage plan.
More importantly, the ACA actually expands Medicare to cover preventive services, such as yearly screenings and wellness checkups, without any cost to you. Also, for those who reach the Medicare Part D “doughnut hole”, you will receive 52.5 percent off of brand-name drugs. This gap is scheduled to be closed by 2020.
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