Obamacare is paradoxically one of the most frequently talked about laws. Three and a half years after its passage, the public remains clueless to many of its key aspects. In fact, aKaiser report published March of this year shows that the public is less knowledgeable about key aspects of the law than it was three years ago. Ironically, in that same report, some of the less well known provisions were the most liked. Here are five laws which you may have forgotten but will be glad you know.
1. Medical Loss Ratio
One of the least known, but most important laws in Obamacare are the medical loss ratios. The medical loss ratio dictates the percent of your premium that goes back to the health insurer's "losses," (known to you as insurance payouts).
Some insurers pay upwards of 25-30% of your premium to overhead costs. Obamacare limits that to 20% and 15% for large companies. Forbes contributor Rich Ungar sees this law as one of the most significant amongst the many changes brought by Obamacare.
2. Health Insurance Exchanges
Insurance exchanges were lesser know commodities when Kaiser released its report six months ago, as the October 1 state implementation deadline nears they are less likely to be so now. That being said, the exchanges form the backbone of Obamacare's effort to expand insurance.
Obamacare requires states to institute exchanges by October 1 of this year or allow the federal government to set up exchanges. The exchange is simply an organized market where the uninsured can shop policies. Preliminary reports show the exchanges premiums competitive with private group insurance.
3. Individual Subsidies
Along with the insurance exchanges, individual subsidies are available for those who make below 400% of the poverty line. For an individual that would be $45,960 and up to $94,200 for a family of four. Those eligible would have their spending on insurance capped based on their income. The cap varies from 2% for those at %133 of the poverty level to 9.5% for those at 350-400%.
4. Small Business Tax Credits
A major focus of Obamacare is providing affordable care for individuals and small businesses. The insurance exchanges provide one venue for affordable care, small businesses whose average salary is less than $50,000 is eligible for 35% (25% for non-profits) tax write-off for purchasing insurance for their employees.
5. Closes Medicare "Doughnut Hole"
A frequent topic in the 2012 debates, the Medicare Part D prescription drug doughnut hole is one of the most important issues to Medicare recipients. Before the Affordable Care Act, a significant gap existed between the initial coverage limit and catastrophic. Once a recipient surpasses the initial coverage limit, they must pay everything up until catastrophic kicks in. This meant that recipients who spent between $2,700 and $6,154 could have to pay upwards of $4,000 of that out of pocket.
Obamacare fills the gap with a subsidy and increased coverage rates which will grow until the gap is closed in 2020.