One year ago today, President Obama signed the historic Affordable Care Act — i.e., health reform. Since most of the recent public attention to health reform has concerned efforts in Congress or the courts to undermine the new law, it’s worth recalling what the law will actually do.
Dramatically reduce the number of uninsured Americans. The Affordable Care Act will reduce the number of uninsured by 34 million by 2021, according to the Congressional Budget Office (see graph). Ninety-five percent of non-elderly legal residents of the United States will have insurance because of the law.
Protect people with serious illnesses or other conditions. Because of health reform, insurance companies will no longer be allowed to deny coverage to people who have pre-existing conditions like cancer or diabetes or who have had a relatively common procedure like a C-section, or to charge them higher premiums. And the law already bars insurers from imposing lifetime limits on benefits, so people who become seriously ill won’t have to worry that their benefits will run out or that expensive medical treatments will push them into bankruptcy.
Make coverage more affordable for individuals and families. Starting in 2014, many people who currently struggle to afford health insurance will get help paying for premiums and out-of-pocket costs (like co-payments for doctor visits). This help will come in the form of tax credits that will be available to help people buy coverage through the new health insurance marketplaces, called exchanges.
Make coverage more affordable for small businesses. Starting last year, an estimated 4 million small businesses became eligible for a tax credit to help offset the cost of buying health coverage for their employees. It costs small businesses much more than larger firms to provide health insurance with comparable benefits, both because they have higher administrative costs and because small businesses with older or sicker workers pay higher premiums. The tax credit will help small businesses that are struggling to provide coverage to their workers and encourage more small businesses to offer coverage.
Begin to slow health care costs across the economy. Rising health care costs are putting pressure on the budgets of families and businesses, as well as public programs like Medicare and Medicaid. The Affordable Care Act takes a number of important steps to lower costs and improve the quality of care by beginning to change the way health care is delivered.