The act was signed in by President Barack Obama, and it is informally known as "Obamacare."
The aim was to improve the health care system of the U.S. by widening health coverage to more Americans, and by protecting existing health insurance policy holders.
No more cancelled coverage for the sick
Medicare reforms have brought more protection for many Americans.
People who already had health insurance would benefit in various ways.
The Act prevented insurance companies from canceling coverage when people became sick, and out-of-pocket costs would be covered for proven preventive and screening services, such as mammograms, diabetes screen, or breast screening, and colonoscopies.
This screening should provide early diagnosis of potentially chronic and serious diseases, when treatments are most effective.
The Act aims to make it easier for working people with no health insurance, and for those with pre-existing conditions, such as asthma or cancer, to obtain reliable health care coverage. It also gives more Americans access to health care coverage.
Children on parental plans up to 26 years
The Act means that young adults can stay on their parents' health plans until they are 26 years old. This includes those who do not live with their parents, those who are out of school, those are not financially dependent on their parents, and those are married. However, spouses and offspring are not covered.
Young adults who had already left a parent-owned plan in 2010 had the chance to enroll again. Parents whose plans were already in place before March 23rd, 2010 were able to enter their young adult children into their plans, if those children were not eligible for their own employer-sponsored plan.
Group plans that started before the Act was signed in would not have to offer health coverage to young adults who qualify for other group coverage.
Tax credits for small businesses
The Affordable Care Act aims to help small businesses to get health insurance for their workers.
Small businesses would receive help in funding the cost of providing health insurance. New tax credits made it more affordable for them to buy health insurance for employees.
Employers would benefit from tax credit if they:
- Provide health care for their employees
- Have no more than 25 full-time workers
- Pay an average yearly salary of less than $50,000.
Starting in 2014, the tax credit was to be 50 percent for small businesses and 35 percent for non-profit ones.
More security for vulnerable Americans
Insurance companies would no longer be allowed to deny health coverage to children aged up to 19 years with any pre-existing condition, disability, or disease that developed before their parents applied for coverage.
From 2014, this was to apply to anybody, regardless of age.
Nor could insurance companies raise premiums for infants or children because of a pre-existing condition or disability.
Adults who were previously denied coverage because of a pre-existing condition, and who had been uninsured for 6 months or more would now get insurance.
The Pre-Existing Condition Insurance Plan (PCIP) was aimed at adults who could not get coverage because of a pre-existing condition, such as diabetes or cancer. From 2014, the Act made access available to them.
Individuals enrolled in Medicare Part D often fell into a coverage gap, often referred to as a "doughnut hole." These people would now receive a 50 percent discount on brand-named prescription medications and a 7 percent discount on generic ones.
In the past, as soon as a person in Medicare part D had spent a pre-determined amount of money, further expenses had to be paid for fully out-of-pocket. The aim was to eliminate this problem gradually within 10 years.
Medicare patients became eligible for mammograms, colonoscopies, and some other preventive services, and all new health policies had to offer these types of screening and preventive services free of charge.
New benefits from 2014
In 2014, a number of benefits were due to come into force.
From January 2014, companies would no longer be able to refuse health insurance policies or to raise premiums for people with pre-existing conditions. Nor could companies raise premiums because of person's gender, as previously happened in some cases.
Insurance must now cover pre-existing conditions.
Essential health benefits and coverage would be guaranteed for almost all Americans. A set of basic benefits would be available on state-based marketplaces, or exchanges, and all exchanges would list the health plans on offer, so that people could compare and shop around for the best plans.
By 2014, all Medicaid state plans had to offer at least:
- Chronic disease management (such as asthma or diabetes)
- Emergency room visits
- Laboratory services
- Maternity and newborn care
- Mental health
- Preventive care.
Most Americans who did not already have health insurance or health coverage had to make sure they did by 2014. Financial assistance became available for those who could not afford it.
Individuals who decided not to be covered would have to pay a fee. Some saw this as a kind of taxation, but anyone who was already spending over 8 percent of their monthly income on health insurance would be exempt.
Dollar limits on the amount of care people are entitled to with insurance companies were to be phased out.
All these changes aimed to ensure that Medicaid health coverage reached a larger percentage of American citizens.
From 2015, physicians would be paid for the value of service they provide, instead of the number of patients. The Act also planned to increase the total number of health care professionals.
The need for reform
Why were these changes needed?
From 1960 to 2009, spending on healthcare in the U.S. rose from 5.1 percent of gross domestic product (GDP) to 17.4 percent.
By 2010, over 50 million Americans had no health coverage at all, and tens of millions had "inadequate coverage." Among the wealthier nations, only America was in this situation.
The U.S. had also fallen behind other wealthy nations in indicators such as life expectancy and infant mortality. In 2011, the U.S ranked number 50 in the world for life expectancy.
Because of this, various doctors' and health groups in the U.S. welcomed the healthcare reforms.
What do people think?
When the Act was introduced, 56 percent of the American adult population generally disagreed with the law. There was overall agreement with many points, but most did not support forcing everyone to have health insurance.
The U.S. Department of Health and Human Services (HHS) states that the Act is working, and positive transformations in access, affordability, and quality are taking place.
Since the Act was introduced, an additional 16.4 million people now have health insurance. This is the largest reduction in the number of people without insurance in 40 years. They also note that the cost of health care has risen at the slowest rate in 5 decades. In addition, hospital-acquired harms, from infections to falls, have decreased by 17 percent.
The HealthCare.gov website is available for anyone to find out whether they qualify for help, to apply for coverage or to change their status.