Affordable Care Act (ACA)

What is the Affordable Care Act?

The Patient Protection and Affordable Care Act (PPACA) is the official name of the Affordable Care Act (ACA), also known as Obamacare (opens in new tab). These are all the same health care reform signed into law on March 23, 2010. The ACA was meant to control health care costs, offer Americans more affordable health insurance options, and make health care more available to everyone. In doing so, it mandated new benefits, rights, and protections for all Americans while creating new rules for health insurance companies.

What has the ACA changed about health care?

Like every law, the Affordable Care Act seems complex. The changes really break down to just a few biggies:

• Makes health insurance mandatory. You must sign up for a qualified health insurance plan or you’ll pay a tax penalty.
• Gets rid of biases. In the past, health insurers could deny you coverage for pre-existing conditions (opens in new tab) or require you to pay more for your plan based on things like your sex or age. The ACA limits these kinds of discrepancies.
• Keeps insurers from kicking you off a plan. If you make an honest mistake on a form, in the past insurers could drop you from a plan. Sometimes people may have even been dropped simply because their bills were costing their insurers too much. Now the only reasons you can be dropped from your plan is if you don’t pay your monthly premium within the given grace period or if you commit fraud.
• Guarantees minimum health care benefits and protections. Qualified health insurance plans must offer a few essential health benefits, (opens in new tab) though some plans offer more than these basics. Some of these benefits, like a number of vaccines (opens in new tab) and your annual well-woman (opens in new tab) exam with your OB-GYN, are free! And in an emergency (opens in new tab), your insurer won't charge you extra for visiting an out-of-network (opens in new tab) emergency facility.
• Sets limits on how much you pay for essential health care. In the past, insurers could set limits on how much they’d cover in a year or even over the course of your lifetime. But now insurers must cover all essential health care benefits, no matter the costs.
• Requires big employers to offer health insurance. Companies with more than 50 full-time employees are now required to offer health insurance to 95% of their full-time staff and their dependent children, or they have to pay a penalty.
• Created a health insurance Marketplace (opens in new tab). If you don’t get insurance through your job or you aren’t sure you want what it does offer, you can sign up for an individual insurance plan for yourself and your family. Qualified individual health insurance plans are those that abide by the ACA requirements, and they’re available through what’s known as a health insurance Marketplace. You can research plans and sign up through HealthCare.gov (opens in new tab), the federal Marketplace, or through your state's Marketplace.
• Guarantees your right to appeal (opens in new tab). If a service or claim was denied by your insurance plan, you can now ask your insurer to reconsider its decision.

Still want more? Download the full Affordable Care Act bill (opens in new tab) for all the fine print.