Surviving a Conversation about the Affordable Care Act

You know it is going to happen.  You will be attending a party or a get together this holiday season and some friend or relative will bring up the topic of the Affordable Care Act (“ACA”) (or Obamacare).  And if you continue reading this, you’ll at least be able to discuss the topic while you quickly finish whatever good cheer you have in your hand in an effort to leave the scene.  So, here it is, a few general things you need to know about the Affordable Care Act that will get you through the conversation.  And to make it easier to remember, we’ve organized the six points into the acronym HEALTH.

• Health care for all, no it isn’t. The ACA is not a health care plan where the government pays for health care for all of our citizens.  These types of plans are common in European countries, and even Canada, but the U.S. opted for a different approach which resulted in the Affordable Care Act.  In a nutshell, the ACA requires everyone to purchase health insurance unless it can be obtained at no cost from the federal government if the individual meets certain minimum income requirements.  If a person can afford to purchase health care insurance, and he or she does not, he/she will be penalized and have to pay an additional tax.
• Exchanges will be online where you can purchase insurance. If you have to purchase health care, you can do so through a state or federal exchange.   Here in Washington, our state has set up its own online exchange as opposed to using the federal exchange.  Here you can go to the exchange and purchase a plan that meets the minimum standards set by the government.

• preexisting condition won’t hurt you – being sick doesn’t prevent you from getting health care coverage.  Once you purchase an insurance plan coverage for your pre-existing condition, it begins immediately. 

• Lower income earners will qualify for a subsidy. The subsidy depends on the amount of income your household makes and how many people are in your household.  For example, a household of one person who makes less than $45,000 per year will qualify for a subsidy.  Likewise a household of four making less than $90,000 annually will also qualify for the subsidy.

• There are penalties if you don’t comply. If you don’t have insurance in 2014 and you can afford it, you will likely have to pay a fee or a tax, which is commonly referred to as the individual responsibility provision.  In addition, if you get sick without health insurance, you have to pay for all of your healthcare. The fee (or tax as some legal scholars will refer to it) will be equal to the higher of 1% of your household income or $95 per person in your household.

• Healthcare must be provided by large employers. Not every employer has to provide health insurance to their employees; only those that have 50 employees or more.  If they don’t, then they must pay a penalty.

If you have made it this far in the article, you probably know more about the Affordable Health Care Act than most of the people in the United States.   Moreover, if you can remember some of these points, you should have the ammo you need to survive a one minute conversation and possibility even dominate it.