Summary of the Affordable Care Act 3
Require all plans offered in the individual and small group markets to cover ten
categories of essential health benefits including maternity care and preventive
care, such as contraception and cancer screenings.
Prohibit preexisting conditions exclusions which historically have included
pregnancy, prior C-section, and history of domestic violence.
Prohibit discriminatory premium pricing based on gender (gender rating).
Prohibit abortion coverage from being required. Federal premium and cost-
sharing subsidies cannot pay for abortion beyond saving the life of the woman or
in cases of rape or incest (Hyde amendment). If a subsidy-eligible individual
enrolls in a plan that chooses to cover abortion services federal subsidy funds
must be segregated from private premium payments or state funds.
Prohibit plans from discriminating against any provider because of an
unwillingness to provide, pay for, provide coverage of, or refer for abortions.
Health
Savings
Accounts
(HSAs)
Leave in place HSA rules as authorized by the Medicare Modernization Act of
2003, including:
- Individuals must be enrolled in qualified high deductible health plan (HDHP) in
order to make tax deductible contributions to an HSA
- Eligible individuals may contribute up to $3,350 annually (2016-2017) tax
free, amount indexed annually to CPI. Additional catch up contribution of up
to $1,000 may be made by persons over age 55. Contribution limits doubled
for enrollment in family coverage
- Amounts withdrawn for qualified medical expenses are not subject to income
tax. Qualified medical expenses include amounts paid out-of-pocket for
services subject to deductible or other cost sharing, and for other uncovered
services, such as eyeglasses, dental care, or long term care. Nutritional
supplements and health club fees are not qualified medical expenses. ACA
also excluded over-the-counter drugs as a qualified expense. Tax free HSA
withdrawals cannot be used to pay for insurance premiums, with exception for
COBRA premiums, health insurance premiums paid while receiving
unemployment benefits, and long term care insurance premiums up to certain
limits. Amounts withdrawn for any non-qualified expense are subject to
income tax; in addition, before age 65 a 20% tax penalty applies for non-
qualified distributions.
- Upon death of account holder, HSA can rollover tax free to an HSA of surviving
spouse; for any non-spousal beneficiary, the account ceases to be a HSA and
account balance becomes taxable to the beneficiary.
Create a temporary national high-risk pool to provide health coverage to
individuals with pre-existing medical conditions 2010-2013.
Selling
insurance
across state
lines
Permit states with similar rules to enter into interstate compacts to share
enforcement and allow insurers to sell policies in any compacting state. Insurers
selling policies through a compact would only be subject to the laws and
regulations of the state where the policy is written or issued, except for rules
pertaining to market conduct, unfair trade practices, network adequacy, and
consumer protections. Compacts may only be approved if it is determined that
the compact will provide coverage that is at least as comprehensive and
affordable as coverage provided through the exchanges.
Exchanges/
Insurance
through
associations
Create state-based health insurance exchanges and Small Business Health Options
Program (SHOP) exchanges through which individuals and small businesses with
up to 100 employees can purchase qualified coverage. Exchanges must display
all qualified health plans and facilitate comparison by consumers and small
businesses. Exchanges must offer call center and navigator services to help
consumers and small businesses apply for coverage and financial assistance and
compare plans. Require the federal government to establish an exchange in
states that choose not to establish their own.
Apply single risk pool rating requirement to plans offered both on and off the
exchange. Plans offered both on and off the exchange that are otherwise the
same must be offered at same price.
Apply individual insurance market rating and other rules to coverage provided to
associations, but not related to employment, and sold to individuals. Generally,