The Affordable Care Act (ACA for short and sometimes referred to as Obamacare) was signed into law by former President Barack Obama in March 2010. It is a comprehensive healthcare reform that helped over 20 million Americans gain affordable health insurance, including individuals who can stay on their parents’ plan until the age of 26.
It has 3 main goals:
- Make health insurance affordable to as many people as possible
- Expand the Medicaid program to cover adults with income below 138% of the federal poverty line
- Support medical care delivery methods that reduce costs
Let’s look deeper at what you might need to know about the Affordable Care Act.
1. Who Is Eligible for the ACA
Individuals of all income levels can qualify for health insurance under the ACA. Still, if your household income is between 100% and 400% of the federal poverty level (FPL), you might qualify for premium tax credits that can reduce the cost of insurance on any plan.
The FPL is updated annually and is the same for the 48 contiguous states and Washington, DC. It is higher in Alaska and Hawaii, though, which can be referred to here.
| Household Size | Income (100% of FPL) | Income (400% of FPL) |
|---|---|---|
| 1 | $15,060 | $60,240 |
| 2 | $20,440 | $81,760 |
| 3 | $25,820 | $103,280 |
| 4 | $31,200 | $124,800 |
| 5 | $36,580 | $146,320 |
To qualify, you must also live in the U.S., be a U.S. citizen or national, not be incarcerated, and not already be covered by Medicare.
Each year, an open enrollment period for people to buy or switch insurance plans typically occurs in November and ends in mid-January (it can vary by state). You can also qualify outside of open enrollment periods, called Special Enrollment Periods, if a life event occurs (getting married, moving, having/adopting a baby, losing health coverage) or your household income falls below a certain amount.
2. Where to Get Insurance Under the ACA
The federal government offers the Health Insurance Marketplace where individuals or families can compare plans if they don’t have access to employer-sponsored coverage. Your state may have its own marketplace as well.
The plans are categorized into four tiers
- Bronze
- Silver
- Gold
- Platinum
As their names suggest, the coverage ranks from least to greatest, as Platinum, the most expensive one, includes plans that cover 90% of health expenses.
Premium costs for the plans depend on which metal tier you choose, your state, and your age, but the average national monthly cost in 2024 was $477.
If you’re ready to find the right ACA marketplace plan, you can use the federal government site or your state’s local marketplace.
3. Pre-Existing Conditions & Essential Health Benefits
As many as 82 million Americans have a pre-existing condition. Essentially, 1 in 2 Americans.
Before the ACA was enacted, insurance companies could turn individuals down or mark up premium costs based on their medical history.
Now, insurance companies can’t refuse to cover or charge you more if you have a “pre-existing condition” under the ACA. This means whatever health problem you had before the date of the new health coverage, like asthma, diabetes, high blood pressure, or cancer, you’ll be protected. This also includes pregnancy!
The ACA also requires all individual and small-group health plans to cover the 10 essential health benefits.
- Ambulatory patient services (outpatient services without being admitted to a hospital)
- Emergency services
- Hospitalization (surgery and overnight stays)
- Pregnancy, Maternity & newborn care
- Mental health & substance use disorder services (includes behavioral health treatment like counseling and psychotherapy)
- Prescription drugs
- Rehabilitative and habilitative services/devices (helps with injuries, disabilities, or chronic conditions to recover mental and physical skills)
- Laboratory services
- Preventive and wellness service, chronic disease management (includes vaccinations and screenings)
- Pediatric services like oral and vision care (doesn’t include adults)
This also includes birth control and breastfeeding coverage.
The above essential health benefits are just the minimum requirements. Services under each category can vary based on your state’s requirements, and they may include other benefits like dental, vision, and medical management coverage.
4. Medicaid Expansion
Medicaid expanded to include millions of low-income people who previously couldn’t qualify for coverage. Now, with the ACA’s Medicaid expansion, almost all adults with incomes up to 138% of the Federal Poverty Level can be eligible to be covered by Medicaid. For 2024, that’s an income of $20,783 for an individual.
Currently, 41 states have adopted the expansion, and 10 have not.
The 10 states that haven’t adopted the Medicaid Expansion:
- Alabama
- Florida
- Georgia
- Kansas
- Mississippi
- South Carolina
- Tennessee
- Texas
- Wisconsin
- Wyoming
For the 10 states that haven’t adopted the expansion, your eligibility is based on income, household size, disability, family status, and other factors that can differ between states. With the expansion in the 41 states that have already adopted it, you’ll qualify based on income alone.
5. Improved Healthcare for Women and Children
Under ACA, the law prevents insurance companies from charging women higher premiums than men and requires the no-cost coverage of:
- Mammograms
- Screenings for cervical cancer
- Prenatal/Maternity care
- Breastfeeding support
- Birth control
- and more critical checks for the health of both women and children
The Bottom Line
As of last year, roughly 40 million individuals benefited from the Affordable Care Act, marking it as one of the most successful, popular, and critical federal programs for people and their families.
If you’re ready to determine whether you’re eligible or want to find the right ACA plan, visit the federal government site or your local state’s marketplace.
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