If you’re using the 5th edition of Personal Finance, Turning Money into Wealth, there has been a significant change in the law since the book was published – the passage of the Affordable Care Act. One easy way to bring it into the classroom is to send your students to the link provided by the government at HealthCare.gov which gives an overview of the law and a year-by-year summary of the implementation the law. The White House also has a website that also provides a summary of the new law. In addition, a short summary of the new law is provided below which you can cut and paste, and then email to your students.
In March 2010, President Obama signed into law into law the new health care bill that commonly goes by the name the Affordable Care Act, the provisions of which are provided on the government’s website. This act is implemented over time, with portions of the new law being effective immediately, and with the final portions of the law being going into effect in 2018.
The different measures in the law can be classified as:
- Providing New Consumer Protections
- Improving Quality and Lowering Costs
- Increasing Access to Affordable Care
- Holding Insurance Companies Accountable
However, even though the Affordable Care Act enacts major changes in health care, your interaction with the U.S. medical system will remain more or less the same — you’ll pay a private insurance company, they’ll reimburse your doctors for care. In addition, while there was much talk of a public health insurance option; there isn’t one, instead, you’ll still deal with one of many insurance companies. In effect, this bill tinkers with the way the current system works, rather than scrapping it and replacing it with a new one.
Still, it does some important things that may affect you. For example, one provision that takes effect in 2014 prohibits insurance companies from denying coverage to those with preexisting health conditions. In addition, employers with more than 50 workers would be required to offer insurance, those that don’t would face a fine of $2,000 per employee. There are other reforms to the insurance market, allowing children to stay on their parent’s insurance policy until they turn 26, keeping insurance companies from dropping people who get sick, and restricting annual and lifetime limits on what your insurer will pay. In addition, for seniors, it works at closing the gap in Medicare prescription drug coverage, known as the “donut hole.”
- Why did the government decide to reform health care?
- Identify some of the provisions aimed at lowering costs.
- Are you glad the Affordable Care Act was passed? Why or why not?