When Barack Obama was re-elected to the White House this November, America was reminded that not only is Obama the first African-American to preside in the Oval Office, he is the first president to make health care a primary component of his presidential legacy. Obama's re-election will certainly have important and lasting effects on the Patient Protection and Affordable Care Act, better known as the ACA or simply Obamacare. Passed by Congress and approved by the Supreme Court during Obama's first term in office, the American public has already seen plenty of positive changes thanks to Obamacare - 3.1 million young people are insured who otherwise would not be, Medicare patients are receiving better services in hospitals across the country, and for the first time in four years, the U.S. Census Bureau has reported a fall in the number of uninsured Americans.
Now that Obamacare is almost certainly here to stay (even Republican House Speaker John Bohner has called it the 'Law of the Land'), it is important to look at how the Affordable Care Act will continue to change the landscape of healthcare and health insurance in the United States. Most ACA provisions will come into effect in 2014, with one of the biggest changes being that insurance companies will no longer be allowed to charge a separate rate based on medical history: Regardless of pre-existing conditions, patients will pay the same price for coverage. This means big savings and security for citizens, but it is actually good news for insurance companies too as Obamacare also mandates that every Americans purchase insurance. That way, insurers cannot discriminate based on pre-existing conditions, but they never have to cover a patient who has not been paying into the system. Win-win, all round. There has been plenty of political turmoil in the past two years regarding this requirement to purchase insurance, but thanks to the recent Supreme Court decision and Obama's victory in November, it seems that the insurance mandate is here to stay.
Therefore, beginning January 1st 2014, every American who can afford insurance but fails to buy it will have to pay a penalty tax, ranging from $95 to $695, or 1% to 2.5% of annual income. But not to worry - for those who cannot afford insurance, the federal government will be offering subsidies based on income levels to help individuals and families with this purchase. Another way Obamacare will help those in the low-income bracket is through an expansion of Medicaid, otherwise known as the Federal Insurance program for those on a limited income. Along with the other sweeping changes of 2014, Medicaid will now be available to anyone with an income up to 133% of the national poverty level. With more people eligible for Medicaid, the hope is that more hospitals, as well as a greater number of small and specialized ones, will accept Medicaid insurance and healthcare will improve for everyone on the program. Furthermore, a higher number of people on Medicaid means more state and federal money, which should lead to needed improvements in benefits and services.
Similarly, the federal program Medicare will be offering better services and lower costs to seniors. One problem with Medicare at the moment is known as the 'donut hole gap.' Basically, prescription drug costs are partially covered by Medicare, but only up until a certain point; once your drug spending has reached $2,800, you fall into the 'donut hole' and are now responsible for the full cost of all drugs. Medicare does not assist with any drug costs until you have crossed the 'hole' and your prescription spending reaches $4,550. To help seniors deal with this serious financial burden of shouldering all drug costs while inside the 'donut hole,' Obamacare will offer rebates, cheaper and better generic drugs and a promise that by 2020 this Medicare coverage gap will be closed and seniors can expect to pay 25% of prescription drug costs until a yearly out-of-pocket limit has been reached, at which point Medicare will cover all costs.
Medicare will also begin to offer better preventative care and an annual wellness visit in order to catch problems such as high cholesterol and prostate cancer in their early and more easily treatable stages. For Americans not on Medicare or Medicaid, there are still plenty of ACA benefits to look forward to in 2014. Without discrimination based on pre-existing conditions, insurance will become less of a burden for those with a family or personal history of medical issues. Similarly, insurers will be prohibited from discriminating against or charging a different rate to women, as the White House has noted in a recent report that at the moment, "a healthy 22-year-old woman can be charged premiums 150 percent higher than a 22-year-old man." All Americans will also enjoy the benefits of having no annual caps on insurance so patients can receive as much care as they need. Financially speaking, the non-partisan Congressional Budget Office has noted that Obamacare should lead to billions of dollars in savings throughout the next ten years due to coverage improvements and cuts in Medicare and Medicaid, taxes on the uninsured who would otherwise cost the government in emergency services, and taxes on medical device manufacturers and brand-name drugs.
In the days following Obama's re-election, medical insurance companies have already seen a positive jump in stock as investors predict rising membership on new and existing insurance plans. Perhaps best of all, the ACA saves money by seeing to it that Congress no longer gets a special federal insurance plan - with Obamacare, a member of Congress must choose from the same pool of health plans available to everyone else. Interestingly, the term 'Obamacare' was coined by rival presidential candidate Mitt Romney; however, upon hearing the purported pejorative, Obama happily adopted the term as his own: "You know, he calls it Obamacare. I like the name. I do care." And when Obama is again inaugurated in 2013, it seems a certainty that the future will hold much in the way of significant changes for American healthcare.