An Overview of the Affordable Care Act (ACA)

The Affordable Care Act is now in effect. Over 12 million Americans have signed up for health insurance through the ACA, many of whom had not previously been able to afford health insurance.

The ACA was necessary for the American people and economy because health insurance and health care in the United States at the beginning of the second decade of the twenty-first century stood at a crossroads: reliance on lightly regulated, excessively profit-driven health sector corporations was driving up the national debt and bankrupting hundreds of thousands of citizens. The status quo was unacceptable.

The United States had the most expensive health care in the world (almost 20% of GDP), while ranking last among developed countries in efficiency and other measurements.  Essentially, full access to health care was available only to the wealthy, while taxpayers subsidized the health care of the tens of millions of Americans who could not afford health insurance (or could only afford inadequate insurance). Yet even the non-wealthy, otherwise adequately insured were susceptible: most medical bankruptcies in America were of insured persons whose health insurance companies refused to pay legitimate medical claims and/or refused to pay claims above a certain amount.

Although America’s health care system was widely regarded as broken by the early twenty-first century, most Republicans in Congress at the time, bearing a long history of opposition to programs designed to help improve the living conditions of less fortunate Americans, were opposed to making health care affordable for ordinary Americans. In an attempt to move beyond the impasse, President Barak Obama and Congressional Democrats turned to an earlier Republican-proposed health care plan (the “Health Equity and Access Reform Today Act” of 1993) as the basis for what became known as the “Affordable Care Act,” now commonly referred to as “ObamaCare.”

Passed by Congress and signed by the President in 2010, the ACA is now mostly operational. Health insurance is now available to most Americans, and individuals can now obtain health insurance via healthcare.gov.

As of 2014, many of the major problems formerly plaguing the health insurance landscape have been resolved:

  • Health insurance companies are no longer able to refuse coverage for pre-existing conditions.
  • Health insurance policies must allow children to be included on their parents policies until age 26.
  • Health insurance companies can no longer place a cap on the dollar amount of claims paid out.
  • Health insurance companies are no longer allowed to refuse valid claims.
  • Medical bankruptcies of American citizens have greatly reduced.
  • Millions of Americans who were forced to take otherwise-unwanted jobs for the sole purpose of having access to (employee-sponsored) health insurance are now free to pursue better opportunities.
  • Lower income Americans who previously could not afford health insurance are now able to do so, thanks to subsidies.

In the meantime, the ACA’s mandate of greater efficiency throughout the health care industry has already brought inflation in the health care industry to a virtual standstill, offering hope that health care as a percentage of GDP will soon begin curving downward for the first time in over half-a-century.

Several years yet remain until the ACA will be fully implemented, and numerous challenges remain in the continued implementation. Many aspects of the ACA pertaining to businesses have yet to be finalized. In addition, many instruments of efficiency have yet to be put into place. Meanwhile, most Republican politicians, loath to provide health insurance for America’s less fortunate while committed to redistributing tax dollars from America’s poor and middle class to billionaires, remain determined to repeal the ACA.

On the other hand, many Americans are hopeful that the Affordable Care Act will bring America a step closer to a comprehensive, responsible, affordable marketplace-supplied single-payer system that will fully provide health care access to all Americans and further drive down health care costs.