Most Americans are well aware that on March 23, 2010, President Obama signed a major piece of legislation entitled the Patient Protection and Affordable Care Act, the content of which will bring about tremendous healthcare reform. But, with the immensity of the written law, as well as all the comprehensive debates taking place in the media regarding the details of the law, many Americans may still be unsure what exact changes this healthcare reform will introduce. The following aims to highlight some of the major changes enacted through this Act over the next four years:
- There will be an elimination of pre-existing conditions for children, as well as an increase in dependant coverage to age 26.
- There will be healthcare coverage for small businesses which employ up to 25 men and women, and companies that employ an average of 50 full-time employees will be required to provide health insurance to their employees.
- There will be a temporary reinsurance program to provide coverage for retirees over 55 who are not eligible for Medicare.
- There will be two prohibitions on insurance companies which include a ban on lifetime limits on benefit payments and a mandate keeping insurance companies from canceling policies in situations other than fraud.
- There will be a $2.3 billion annual fee which will be implemented on drug makers, to increase exponentially over years.
- Cuts will begin being made to Medicare Advantage Plans with instituted changes regarding their payment formula.
- Beginning on January 1, the Medicare tax—now known as the “Unearned Income Medicare Contribution”—will be assessed on estates, trusts and families with net investment income above $250,000, and for single taxpayers over $200,000 at a rate of 3.8%.
- There will be an increase in the Medicare payroll tax for couples making more than $250,000 and individuals making more than $200,000, with a tax rate rise from 1.45% to 2.35%.
- All insurers will be obligated to accept all applicants, and all Americans must be insured. Taxpayers who go without insurance will receive a tax penalty of $695 per year or 2.5% of household income over the threshold amount.
- There will be sufficient tax credits to help middle-class working families in low-income situations to pay their premiums. This includes help with co-payments and deductibles.