Health care is a policy issue that always seems to spark intense public debate. The Affordable Care Act (ACA), which President Obama introduced in 2010, continues to receive scrutiny from both Republicans and Democrats. It emerged as a key issue in the 2020 presidential election. As President-elect Joe Biden moves into the Oval Office, his administration is expected to implement changes to make the ACA even more accessible. Here are highlights of the Affordable Care Act and Joe Biden’s plans.
A Quick Overview of the Affordable Care Act
The Affordable Care Act, also known as Obamacare, was enacted with the primary goal of ensuring that more Americans are covered by health insurance.
The main pillars of the ACA are:
- Premium tax credit subsidies for working families with incomes between 100% and 400% of the federal poverty level
- Expanded Medicaid coverage for low-income beneficiaries earning below 138% of the federal poverty level, with income as the only eligibility criteria.
- -Because there’s been resistance to this change in some states, this expansion hasn’t been realized at a national level.
- Exploration of new ways of delivering care to simplify the health care system and reduce overall costs
These changes are intended to eliminate gaps in coverage among Americans with low and moderate incomes.
The Debate Surrounding the ACA
Right-leaning politicians want to repeal the ACA because they don’t believe the government should subsidize health care or increase taxes to fund health coverage expansion. Until it was recently rendered irrelevant, they also took issue with the tax penalty levied on those not covered by health insurance.
On the other end of the spectrum, some left-leaning politicians feel a single-payer healthcare system should replace the ACA and the nation’s currently complicated network of health insurers, with all Americans having health care coverage under one insurance plan
There are different visions of what this could look like, but the essential agreement among those who support another system is that the ACA doesn’t go far enough toward achieving universal health care.
Highlights of Affordable Care Act and Joe Biden’s plans
Joe Biden was Vice President when the ACA was enacted, and his plan involves keeping the basic framework of the existing system in place. But because health care can be expensive and hard to navigate, his platform is based on amending the ACA and improving what’s already in place.
The goals of the proposed changes are to:
- Give Americans more choice when it comes to health insurance
- Increase the number of Americans covered by health insurance
- Reduce patient costs
- Simplify the health care system
At the heart of the plan is the belief that all Americans should have access to affordable health care so they can take care of their families in the event of illness. According to Biden’s campaign platform, the goal is to ensure an estimated 97% of Americans have insurance.
Here are some of the strategies to achieve this plan.
1. Implement a New, Affordable Public Health Insurance Option
Most Americans who have a health plan are covered either through an employer-provided plan or by one they purchased from a private insurer. Biden’s plan is to provide a third option by creating a public insurance plan for those who find private health insurance too expensive. Operating similarly to Medicare, this public plan was initially part of the original Obamacare proposal. The proposed public health insurance plan features:
- Arrangements with health care providers to help patients save money
- Primary care provided to beneficiaries without copayment charges
- Coordination of services to improve care quality
The proposed public health insurance plan would also ease the burden for small companies that have difficulty paying for their employees’ coverage.
2. Enable More Middle-Class Americans to Access Tax Credits and Improve Health Insurance Coverage
Currently, families who earn between 100% and 400% of the federal poverty level receive a tax credit to help offset their health insurance costs. Premiums are capped at a percentage of their income.
The Affordable Care Act and Joe Biden’s plans proposes to increase access to these tax credits by:
- Removing the income cap to make health care coverage more affordable for families earning above 400% of the federal poverty level
- Limiting the amount Americans spend on health insurance premiums in the marketplace to 8.5% of income instead of 9.86%, no matter how much a person earns
- Calculating subsidies based on a gold plan rather than a silver plan, so families receive better coverage and have lower deductibles and out-of-pocket costs
With these proposed changes, a family of four with an income of $110,000 per year would see premiums for plans in the individual marketplace reduced by half, saving about $750 per month, according to the Biden campaign.
3. Enable More Low-Income Americans to Access Health Insurance Coverage
When the ACA was enacted, one of the major ways it sought to improve coverage for low-income Americans was by making health insurance automatic for those earning less than 138% of the federal poverty level. This coverage was to be delivered through Medicaid. However, a Supreme Court ruling in 2012 made this optional at the state level.
As a result, 14 states haven’t implemented this change to Medicaid eligibility. A study by the Kaiser Family Foundation found that there’s an estimated 4.4 million uninsured, nonelderly adults who are affected by their state’s decision to not participate.
Once a public health insurance option is introduced, Biden’s health care plan aims to give premium-free coverage to this group of low-income individuals. Enrollment would be automatic once beneficiaries enroll in other support programs such as SNAP.
Restructuring of the Health Care System
The affordability of health care and Americans’ ability to access insurance are only parts of Biden’s plan. Another part of the plan is to make the health care system easier to understand and more efficient, helping to reduce overall costs.
This would be accomplished by:
- Creating partnerships to improve quality of care
- Ensuring a variety of providers and competition by addressing issues of market concentration
- Ensuring patients receiving care from an in-network provider aren’t unexpectedly billed for services, such as care from a doctor or specialist that isn’t part of the network
Has the ACA Been Effective?
In the decade since the Affordable Care Act reforms came into effect, about 20 million more Americans have health insurance coverage. A study by the Kaiser Family Foundation shows that in 2010, 46.5 million Americans were uninsured. By 2016, the last year of the Obama-Biden administration, the number of uninsured nonelderly adults dropped to 26.7 million. The uninsured rate climbed again after this, to 28.9 million in 2019.
According to the New York Times, researchers are trying to understand the impact of changes to the ACA during the Trump presidency, such as eliminating the requirement that most Americans have health insurance and reduction of funding to promote ACA programs.
Finding Affordable Health Insurance Coverage That’s Right for You
As the Affordable Health Care Act continues to evolve under future administrations, you can expect more changes to come in our health care system. And while there’s a lot to consider for navigating the health insurance marketplace and finding an affordable plan, TrueCoverage can help make the process easier for you. Contact our insurance experts for a free quote to find a competitive health insurance plan that covers your needs.