6 things consumers need to know about the Affordable Care Act

Affordable Care Act - Consumer Reports 7 Things You Need to Know - photo courtesy of US NewsConsumer Reports just released a detailed breakdown of Affordable Care Act changes on the horizon.

Here's 6 things you need to know:

1) Insurance Protections and Benefits Expanded: Insurers cannot rescind your policy if you get sick, or cancel if you make a mistake in your insurance application; consumers will have a faster appeals process if coverage is rejected; lifetime limits on medical expenses will be removed with some exceptions; more free preventive care and checkups/screenings will be available; more transparency in medical coverage and premium rebates if insurers spend health care dollars inefficiently.

2) Changes Coming in 2014: Consumers will have to purchase health insurance or face a tax penalty; no more pre-existing condition denials; new health information exchanges will go live on the Web, allowing individuals, families, and small businesses to shop for care online; more federally funded training of primary care doctors and care coordination; Medicaid will expand for low-income Americans, enabling up to 17 Million more Americans to be eligible for Medicaid.

3) "Individual Mandate" Penalty: For an individual, the tax starts at $95 a year or up to 1 percent of income, whichever is greater, and by 2016 rises to $695 per individual or 2.5 percent of income. For a family, the tax is capped at $285 in 2014 and rises to $2,085 or 2.5 percent of income in 2016.

4) Logistics of Online Marketplaces:  Online marketplaces, also known as Health Information Exchanges (HIE), will go live on 10/1/2013 for coverage starting in 2014.  HIEs will give consumers a streamlined one-stop shop process for assessing and purchasing insurance, and determining eligibility for specific coverage in a single Web session.

5) Who Will Help with Insurance Costs: if your State decides to offer it, Medicaid will cover you if you earn <$15,302 per year (if single) and <$31,155 (if family).  If single income is between $11,505 - $46,021 or family income is between $23,425 - $93,700, insurance financing options will be available assuming you buy from your states' HIE. If single and income <$28,763 or family and income <$58,562, subsidies for out-of-pocket will be available, again assuming you buy insurance through your states' HIE.

6) Changes for Employers and Small Businesses:  The ACA does not require employers to purchase health insurance.  However, businesses with 50 or more employees that do not offer coverage or provide expensive coverage that doesn't meet minimum standards will be penalized.  Small businesses with <50 employees will not face penalties if they choose not to provide coverage.  Small businesses with 25 or fewer employees are eligible for a tax credit of up to 35% of employee insurance premiums assuming two conditions. 1) employer covers at least 50% of employees' premiums and 2) annual salaries of those employees does not exceed $50,000.

Small businesses with up to 100 employees will also be able to use health information exchanges to purchase employee health plans.