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The Patient Protection and Affordable Care Act was signed into law by Barack Obama on March 23, 2010. With Donald Trump now in office and looking to repeal the act, it is important to examine what exactly ‘Obamacare’ was and why it was and remains important to so many Americans.
Q. What is Obamacare and what does it do?
A. The full name of the statute is the Patient Protection and Affordable Care Act (ACA for short), and it represents the most significant overhaul of the US healthcare system since the 1960s. The main changes to the previous healthcare system was to the individual insurance market which were radically overhauled.
The aim of Obamacare was to extend health insurance coverage to the estimated 15% of the population who lacked it. Those people received no coverage from their employers and are not covered by US health programmes for the poor and elderly. To achieve this aim, the law requires all Americans to have health insurance but offers subsidies to make insurance more affordable.
Obamacare also requires businesses with more than 50 full-time employees to offer health insurance.
The law created state-run marketplaces where individuals can compare prices when they look to purchase coverage. Some states chose not to participate, and so their residents can compare prices on a marketplace run by the federal government instead.
In addition to these changes, the law also bans insurance companies from denying health coverage to people with pre-existing conditions, allows young people to remain on their parents’ plans until the age of 26, and expands eligibility for the Medicaid health programme for the poor.
Q. What opposition was there to Obamacare?
A. The Republicans have generally opposed the law since it was first proposed by Obama in 2009. After the law was passed in 2010, they launched several legal challenges, with the Supreme Court declaring it constitutional in 2012.
Republicans say that the law imposes too many costs on business, describing it as a ‘job killer’, yet since the implementation of Obamacare jobs in the health care sector rose by 9%. They have also called it an unwanted intrusion into the affairs of private businesses and individuals.
Now, with Donald Trump in office, the Republicans are looking to repeal and replace Obamacare almost completely.
Q. Who benefits from Obamacare and who would suffer if it was repealed?
A. It is estimated that 22 million people would lose insurance if Obamacare was repealed, as provisions of the law make insurance more accessible to people who had previously been denied coverage. The uninsured rate has dropped by 5% since the programme began.
As well as this, one of the provisions that has proved popular is that companies were no longer allowed to charge women more than men, something which, if repealed, could cause women’s health coverage to become more expensive again.
Q. What were the flaws of Obamacare?
A. One of the biggest flaws with Obamacare came from the Supreme Court’s 2012 ruling. Although they found the ACA constitutional, they also struck down a provision that said states had to change how they administered Medicaid. Under Obamacare, states were supposed to expand the number of people who qualified for Medicaid, which had been preserved for the poor, and in return those states would receive more funding. The court, however, said that states could choose not to participate in this expansion of Medicaid. As a result, poor and working-class families who didn’t qualify for Medicaid ended up having to pay more for private insurance.
Some insurance companies backed out of participating in Obamacare, because fewer than anticipated Americans signed up, which in turn raised the costs of insurance for everyone else, in turn driving down participation numbers further.