The Affordable Care Act, or ACA, was signed into law in 2010 and implemented in 2014. It created health insurance marketplaces where individuals can shop for and purchase insurance coverage. It also created premium tax credits to help make health insurance more affordable for low- and middle-income households. It established and expanded Medicaid to include many more low-income Americans. It also set a requirement that all Americans must have minimum essential coverage and that employers provide insurance or pay a fine for employees who do not have access to employer-sponsored insurance.
The ACA also changed the way medical expenses are reimbursed by private insurers. It requires that most private insurance plans cover preventive care, including annual check-ups and flu shots, without charging the patient for them. This preventive care is important because it helps identify and treat potential problems before they become serious or lead to more costly issues.
Despite a number of legislative attempts to repeal or fundamentally alter the ACA, the vast majority of Americans support the key aspects of it that have made health care more affordable for families and individuals. A 2024 KFF poll found that 69% of Americans believe that the ACA’s core provisions are “very important” to keep.
Some of the most notable ACA changes took effect on January 1, 2014, and included the elimination of discrimination in obtaining insurance on the basis of a preexisting condition and the establishment of a minimum set of health benefits, known as essential health benefits. These must be offered by all ACA-compliant health insurance policies, but plans can choose to add additional benefits like dental and vision.
Individuals with household incomes at or below 400% of the federal poverty level are eligible for financial assistance to help pay for health insurance purchased through an ACA marketplace. This is called a “premium subsidy” or “cost assistance.” Families with more than four members can have household incomes up to 400% of FPL and still qualify for this assistance. The March 2021 COVID-19 relief legislation, the American Rescue Plan Act, extended these subsidies and the 2022 Inflation Reduction Act will ensure that this continues for the foreseeable future.
The ACA has changed the way physicians and auxiliary health care providers, such as nurses, practice medicine. It has led to new payment models that are based on outcomes rather than traditional fee-for-service payments. It has also improved communication between physicians and patients.
Repealing the ACA would result in substantial uncompensated health care costs for hospitals, physician offices, and community organizations. Some studies estimate that between 2019 and 2028, the cost of uncompensated care would increase by $1.1 trillion. In addition, the loss of premium subsidies and a reduction in Medicaid expansion would have negative economic impacts for states, counties, and communities. Moreover, the ACA has significantly reduced rates of poverty and inequality by providing health care for millions of people who previously did not have it.