Monday 10 May 2021

Understanding the Affordable Care Act and its importance

Understanding the Affordable Care Act and its importance

One of the most essential needs of a citizen is the availability of affordable health services. Health Services in the US suffered from high medical fees and thus, people with limited wages had become ignorant of their health issues as long as they didn’t become absolutely necessary. This changed with the onset of the Patient Protection and Affordable Care Act on March 23, 2010, after the then President Mr. Obama signed on the passed bill. That’s why it is popularly known as Obamacare.

Understanding the Affordable Care Act and its importance

What is the Affordable Care Act?

Affordable Care Act or ACA, quite literally, aims at granting affordable health services to the citizens of the US. It was designed to help poor people get the necessary clinical assistance in time without worrying about their bills. ACA was the most revolutionary and one of the major changes after the  Public Health Services Act in 1944.

Affordable Care Act improved the availability of health services to common people by transforming the health insurance industry in many ways. This bill has insured more than 20 million people since March 2010. This number, in itself, expresses the success of the ACA or Obamacare. Out of many other key features, ACA is one of the most comprehensive law which directly aims at the comfort and needs of the employees. ACA mandates a company with 50 or more full-time employees to provide health insurance to their employees. It also requires that the offered health plan is affordable, i.e, it should cost 9.5% or less of an employee’s household income. Affordable Care Act reporting requirements can be really complex and can lead your company or firm to be heavily penalised. But, why invest time in something that is not the primary concern in the growth of your company? Hire a tax reporting firm to let professionals handle these complexities.

Key features of the Affordable Care Act or Obamacare

The ACA includes health benefits for various sections of the society. To understand the benefits of the Affordable Care Act law, mentioned below are some of its key features.

An existing illness won’t affect the availability of the insurance benefits.

This was one of the major issues which were tackled by the Affordable Care Act. Insurance was denied to a person with any serious illness or someone who needed immediate medical attention. ACA or Obamacare made the health insurance benefits available to citizens who had a pre-existing illness.

Lower costs of prescribed medications.

The cost of prescriptions medicines will decrease due to lesser “donut hole”. ACA has improved the reach of Medicare scheme by making it more affordable. It is even estimated that “donut  hole’ will eventually be eliminated by 2020.

Improved Transparency of the Health Insurance

One of our major concerns, while choosing a health insurance, was what all terms and conditions are behind a plan. ACA has made it mandatory that all the health plans must provide a summary of the enclosed benefits and conditions to their applicants. This improves the transparency of the Health Insurance Plans to a great extent.  

For the Employees

Under ACA Law, applicable large employers (ALEs) are liable to pay penalty if they don’t provide affordable care to their employees. This penalty, as already mentioned, is applicable to companies or firms with 50 or more full-time employees. It asks these applicable employers to provide coverage that satisfies at least the minimum affordability standards.

There are many such clauses carefully designed in the favor of the citizens. The law requires the employers and insurers to fill the necessary documents with all the reporting requirements of the Affordable Care Act. Focus on the growth graph of your company by saving yourself from the complexities like filing 1094-c or 1095-c forms. Hire a tax reporting firm right now!

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