Affordable Care Act

The Patient Protection and Affordable Care Act (ACA), also known as, Health Care Reform (HCR) was signed into law on March 23, 2010. ACA increased access to health insurance benefits by providing affordable coverage and financial assistance. The State of California enacted legislation to establish Covered California (Covered CA), the California Health Benefit Exchange. Covered CA is the place where Californians can get brand-name health insurance under ACA and utilize tax credits to reduce their monthly health premiums. Individuals can apply online, over the phone, by mail or in person and may be eligible for federal premium assistance on private insurance, Medi-Cal (MC) or consumer protection programs (such as Soft Pause).

Many changes occurred following the implementation of ACA: insurance companies cannot deny applicants with preexisting conditions, there are no annual or lifetime limits, essential services are included in health plans, and insurance companies must follow rules for increasing rates for clients. The initial open enrollment for Covered CA began in October 2013, allowing applicants to receive their new health plan benefits as early as January 1, 2014. Covered CA began offering a range of health care coverage, making it easier and affordable for individuals and small businesses to purchase health insurance.

Health Care Changes Since 2014

The ACA changed many aspects of healthcare and insurance in the United States of America. These changes are as follows:

Increased Access to Health Insurance

The ACA established state exchanges, where individuals and small businesses shop for health insurance online, in person or by phone.

Affordable Coverage and Financial Support

Individuals and families with low to moderate income may qualify for federal financial assistance.

Guaranteed Availability of Coverage

All health insurance plans (except most sold before March 10, 2010) cover individuals regardless of pre-existing health conditions. Insurance companies cannot drop clients from health insurance for getting sick or making a mistake during the application process.

Young Adult Coverage

Dependents up to the age of 26 may remain covered under their parent's employer-sponsored plan.

Preventive Care

All health plans must cover preventive care and medical screenings like mammograms and colonoscopies, recommended immunizations, and additional preventive care and screenings for women. Health insurance companies cannot charge copayments, coinsurance, or deductibles for such services when the insured is using a contracted doctor or hospital within the health plan's network.

Essential Health Benefits

Newly sold health plans cover services that fall into 10 categories of Essential Health Benefits or Minimum Essential Coverage.

Health Benefit Standard

Four benefit categories of plans (Bronze, Silver, Gold, and Platinum) are available to choose from, so applicants can compare plans and see expected costs. Refer to Metal Tiers. Additionally, a separate Basic Coverage Plan is available. A Basic Coverage Plan (Catastrophic plan) helps protect a person from financial disaster in the event of a serious and expensive medical emergency.

This plan does not cover (non-preventive) day-to-day medical expenses such as doctor visits, prescription medicines, or emergency room visits.
It covers excessive medical bills that occur above the limit that one would be able to manage financially.
A certification is required to indicate that an individual is without affordable coverage or experiencing hardship.

No Lifetime or Annual Limits

Health plans cannot put a lifetime dollar limit on most benefits.

Consumer Assistance Program

New federal grants help states improve their consumer assistance programs to help applicants with filing complaints and appeals, enrolling in health coverage, and getting educated about their rights.

Penalties for No Coverage

Beginning 2014 and through 2016, most U.S. residents were required to maintain public or private health insurance or pay a financial penalty to the IRS. The State of California has reinstated this individual mandate effective January 1, 2020 and requires penalties to be paid to the state’s Franchise Tax Board (FTB).

California State Subsidy

Starting January 1, 2020, Californians will get new financial help from the state of California in addition to the financial help they may be eligible to receive from the federal government to help them obtain health insurance.

Business Healthcare Requirements

Employers with 50 or more full-time equivalent employees that do not offer affordable insurance or coverage that meet minimum standards started receiving penalties in 2014. Businesses with fewer than 50 full-time equivalent employees that do not provide health coverage do not face a penalty but are encouraged to consider affordable employee coverage options.

Rate Increase Rules

Health insurance companies must justify premium increases. Insurance companies are required to spend 80 percent of the premium dollars on quality healthcare, not administrative costs like salaries and marketing.

Small Business Premium Assistance

Small businesses purchasing health insurance may qualify for premium assistance to help offset the cost of enrolling employees in health insurance.

Health Insurance Exchange

Health Insurance Exchanges create a competitive market for health insurance, provide a choice of health plans, establish common rules regarding the offering and pricing of health insurance, and provide information to help applicants better understand their options. Covered CA is the Health Benefit Exchange in California; other states may have created their own exchanges or use the Federal Health Benefit Exchange. Several key features of Health Benefit Exchanges include:

Certified health plans
Enrollment coordination
Telephone assistance hotlines
Internet websites
Uniform enrollment forms
Online cost calculators
Premium assistance for eligible individuals and families
Cost sharing reduction for eligible individuals and families
Tax credits for eligible small businesses