Meaning Of Obamacare Vs Medicaid
Obamacare is a term used to refer to a private health insurance that a US citizen can purchase from an insurance company through the Patient Protection and Affordable Care Act. Medicaid, on the other hand, is a government-provided health insurance program designed to help low-income earners aged over 65 years and other young citizens with select disabilities.
Advantages And Disadvantages Of Obamacare
After years of discussions over the inadequacies of health insurance and health care costs in America, the advantages of Obamacare passage in 2010 were sizable. After the Affordable Care Act was passed, millions more Americans could finally get the health care coverage they needed and could find coverage for the most important parts of health care, including preventive and ambulatory services. Some of the other advantages of Obamacare include the following:
- Individuals have more health insurance options.
- Americans with low incomes can take advantage of tax refunds to pay for health insurance.
- Insurance companies are required to put at least 80 percent of the money they make on premiums back into health care and insurance improvements.
- Individuals with preexisting health conditions can find full health insurance coverage.
- Caps on health care coverage were removed.
- Important health care screenings and wellness visits are covered.
The Battle Over The Aca / Obamacare
From the earliest conversations about the Affordable Care Act, the law and its provisions have been vigorously opposed by Congressional Republicans.
The opposition has included numerous legal challenges over the ACAs constitutionality as well as piecemeal weakening of the law by President Donald Trumps administration. Consumer advocates note that this opposition has worsened coverage options and driven premiums upward. But the Biden administration has taken various steps to protect and strengthen the ACA, and the American Rescue Plan, enacted in March 2021, made the ACAs subsidies much stronger for 2021 and 2022 .
Read more about 50 benefits wed lose if the ACA were to be overturned, and 50 populations that are better off with the ACA in place.
Steve Anderson, healthinsurance.orgs editor and content manager, has been writing about health insurance and health reform since 2008. Steve is also co-founder and editor of medicareresources.org. In previous lives, he worked as a community journalist, public relations manager and director of public affairs.
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Fig 2 Percent Of Enrollees With Expenditures Below The Age
NOTE: We assume premiums are actuarially fair . Data come from COMPARE model estimates for 2015. We assume that the individual mandate is in effect, tax credits and subsidies for marketplace coverage are available for qualifying individuals, and Medicaid expansion has occurred in participating states.
Ending Essential Minimum Benefits
From a policy perspective, the ACA benefit design has both an upside and downside.
- The Upside
- Guarantees that people who need benefits have access to affordable care
Various repeal and replacement proposals, including the version of the AHCA passed by the House of Representatives in May 2017, would allow states to waive or redesign the ACAâs essential minimum benefit requirement. RAND analysis found that in general eliminating essential benefits would reduce premiums overall but also sharply increase costs for consumers who need those services. For example, removing maternity and mental health benefits from coverage would likely lower premiums in the individual market premiums by about 5 percent overall but out-of-pocket spending for women in need of maternity care could rise by $7,894 if maternity benefits were dropped. For a typical consumer of mental health and substance abuse services, out-of-pocket spending would increase by $1,088.
The Right To Preventive Care
Preventive care is essential to reducing overall healthcare costs in America. The Affordable Care Act requires insurance plans to cover certain preventive health services at no cost to you, as long as you see an in-network provider. Services include:23
- Alcohol misuse screening and counseling
- Blood pressure screening
- Cholesterol screening for older and high-risk adults
- Colorectal cancer screening for adults over 50
- Depression screening
- Type II diabetes screening for adults with high blood pressure
- Diet counseling for high-risk adults
- Hepatitis C screening for some adults
- HIV screening
- Lung cancer screening for older, high-risk adults
- Obesity screening and counseling
- Tobacco use screening and cessation interventions
- Several vaccines
- Special services for pregnant women or women who may become pregnant
- Behavioral assessments for children
- Screenings and tests for newborns and children
If youre unsure about a test or screening, check the full list of covered preventive care services.
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How Is Medicaid Eligibility Determined
Medicaid beneficiaries generally must be residents of the state in which they are receiving Medicaid. They must be either citizens of the United States or certain qualified non-citizens, such as lawful permanent residents. In addition, some eligibility groups are limited by age, or by pregnancy or parenting status.
How The Programs Differ
Medicare is an insurance program while Medicaid is a social welfare program.
Medicare recipients get Medicare because they paid for it through payroll taxes while they were working, and through monthly premiums once theyre enrolled.
Medicaid recipients need never have paid taxes and most dont pay premiums for their Medicaid coverage .
Taxpayer funding provides Medicaid to eligible needy people in a manner similar to other social welfare programs like Temporary Assistance for Needy Families Women, Infants and Children and the Supplemental Nutrition Assistance Program.
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Medicaid Eligibility And Costs
The federal and state partnership results in different Medicaid programs for each state. Through the Affordable Care Act , signed into law in 2010, President Barack Obama attempted to expand healthcare coverage to more Americans. As a result, all legal residents and citizens of the United States with incomes 138% below the poverty line qualify for coverage in Medicaid participating states.
While the ACA has worked to expand both federal funding and eligibility for Medicaid, the U.S. Supreme Court ruled that states are not required to participate in the expansion to continue receiving already established levels of Medicaid funding. As a result, many states have chosen not to expand funding levels and eligibility requirements.
Those covered by Medicaid pay nothing for covered services. Unlike Medicare, which is available to nearly every American of 65 years and over, Medicaid has strict eligibility requirements that vary by state.
However, because the program is designed to help the poor, many states have stringent requirements, including income restrictions. For a state-by-state breakdown of eligibility requirements, visit Medicaid.gov and BenefitsCheckUp.org.
The Cadillac Tax Versus Limiting Tax Breaks For Employer
Of the various mechanisms for raising revenues in the ACA, one of the most debated has been the “Cadillac tax,” scheduled to take effect in 2018. The Cadillac tax consists of a 40 percent tax on premiums for employer-sponsored plans in excess of a dollar limit . The tax would be jointly paid by employers and workers on their respective contributions.
The Cadillac tax seeks to address problems with the tax advantage for employer-sponsored insurance , which allows premiums to be paid with an unlimited amount of pre-tax dollars. The current tax break has been criticized for encouraging overly comprehensive benefits and promoting overconsumption of care. The tax break also costs the federal government roughly $323 billion each year. However, the Cadillac tax has also been criticized for making high-cost plans too expensive, particularly for firms with older and sicker workers, and because the flat 40 percent excise tax is not progressive, like federal income tax.
We compared the effect of the Cadillac tax and an exclusion cap that treats individual contributions to health premiums above $10,451 and family contributions above $28,178 as income. For families in all income categories, spending for health benefits declines, but the declines are larger for the Cadillac tax than for the tax cap. But when changes in health benefits are combined with changes in take-home pay, the differences in progressivity between the Cadillac tax and the tax cap were small.
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How Efficient Is Medicaid
Medicaids costs per beneficiary are substantially lower than for private insurance and have been growing more slowly than per-beneficiary costs under private employer coverage.
Medicaid provides more comprehensive benefits than private insurance at significantly lower out-of-pocket cost to beneficiaries, but its lower payment rates to health care providers and lower administrative costs make the program very efficient. It costs Medicaid much less than private insurance to cover people of similar health status. For example, adults on Medicaid cost about 22 percent less than if they were covered by private insurance, Urban Institute research shows.
Over the past 30 years, Medicaid costs per beneficiary have essentially tracked costs in the health care system as a whole, public and private. In fact, costs per beneficiary grew more slowly for Medicaid than for private insurance between 1987 and 2017, and are expected to continue growing more slowly than for private insurance in coming years, according to the Medicaid and CHIP Payment and Access Commission.
Moreover, the Centers for Medicare & Medicaid Services , which projected in 2010 before enactment of the Affordable Care Act that Medicaid spending would total $794 billion by 2019, has lowered its projection for 2019 by 21.5 percent to $623 billion, even with the ACAs coverage expansions.
The Cost Of Trumpcare According To The Cbo The Uninsured Rate Under Trumpcare And The Controversial Planks Of Trumpcare
TrumpCare also does some very controversial things in its current iteration, some of which go against Trumps campaign promises of more coverage,covering everybody, and not letting them die on the streets .
Instead of covering everybody, TrumpCare defunds Planned Parenthood, takes away demand from healthcare providers , takes away funding states could have used for state-based healthcare solutions, and takes large amounts of cost assistance away from Seniors who havent reached Medicare age.
However, on the plus side, it leaves some very important provisions of the ACA in place and fixes a few things like the fee associated with the mandate and cost assistance for those making less than 100% of the poverty level.
This means some could see premiums reduced , but others would see costs increase and access diminished .
With all that said, personal costs and coverage implications aside, in terms of national costs and coverage:
The CBOs July 20, 2017 report: CBO and JCT estimate that enacting the Better Care Reconciliation Act of 2017 would reduce federal deficits by $420 billion over the coming decade and increase the number of people who are uninsured by 22 million in 2026 relative to current law .
We will discuss pros and cons, but these are the basics.
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Summary Of Obamacare Vs Medicaid
The two schemes are designed to offer better and affordable health insurance. Even though such conditions like the beneficiaries differ, their goals are similar. It is also worth noting that even though one can enroll for both the Medicaid and Medicare plans, one cannot register for both the Obamacare and Medicaid plans. It is, therefore, crucial that one seeks assistance from qualified offices before taking a step on any of the schemes.
When Can I Enroll In Obamacare
Open enrollment typically lasts from November through mid-December for coverage the following year. This past year open enrollment was extended in response to the ongoing coronavirus pandemic.
If you dont choose to enroll during the Open Enrollment Period, your options to purchase coverage become limited. You cannot purchase ACA-compliant coverage unless a qualifying event occurs. These events include:
- Loss of a job
- Move to a new coverage era
- Birth of a child
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The Difference In Enrollment Periods
People who qualify for Medicaid can enroll in this plan throughout the year, whereas the enrollment period for ACA plans is only possible during the annual open enrollment period. Besides, annual open enrollment period, individuals may be eligible for a limited special enrollment period if they face any qualifying life events like a change of marital status, birth or adoption of a child, or loss of insurance coverage. Individuals who dont have a qualifying life event triggering a special enrollment period have to wait until the next open enrollment period to apply for the ACA plans. The ACA compliant health plans sold outside the exchange also have the same limited enrollment period.
Can One Have Dual Eligibility For Both Medicare And Medicaid
Yes, Medicare and Medicaid are not mutually exclusive programs. Persons who are eligible for both are referred to as having Dual Eligibility, Dual Eligibles, or often simply Duals. Medicare is the first payer of covered benefits, while Medicaid is the secondary payer. Typically, Medicaid will pay for Medicare premiums and co-payments for dual eligibles. In fact, many states have special programs intended to make it easier for seniors to manage their dual eligibility status as it can be confusing to know where to turn for what services. This is generally in the form of managed care.
There are also programs called Medicare Saving Programs for low-income seniors that dont quite qualify for Medicaid.
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What Is The Medicaid Coverage Gap
In the states that have not expanded Medicaid, theres a coverage gap that leaves about 2.2 million people ineligible for any sort of affordable coverage.
And according to US Census data, the percentage of people below the poverty level who are uninsured is more than twice as high in states that havent expanded Medicaid, compared with states that have. To be clear, this is due to the decisions that their states have made, rather than a flaw in the ACA itself. The states could opt to accept federal funding to expand Medicaid at any time, thus closing the coverage gap.
Five states Texas, North Carolina, Florida, Georgia, and Tennessee account for the lions share of the coverage gap population, and they are among the 12 states where expansion is still a contentious issue and the legislature and/or governor are still strongly opposed to accepting federal funding to expand Medicaid.
For people in the coverage gap who received unemployment compensation for at least one week in 2021, the American Rescue Plan provided eligibility for premium subsidies. But this was a temporary provision for 2021.
Individual Mandate: Trumpcare Vs Obamacare
The ACA penalizes consumers who can afford to buy health insurance but do not do so with a fee, sometimes called the individual mandate or the individual shared responsibility payment. This fee must be paid for any month in which you do not have a qualifying health plan and its paid when you file your federal tax return. There are many ways to become exempt from the mandate, however, including financial hardship.
This penalty is either 2.5% of your household income up to the total yearly premium for a Bronze package on the Marketplace or $695 per person up to $2,085, whichever is higher.
Trumpcare eliminates the individual mandate and instead offers a financial incentive for consumers who maintain coverage: insurance companies can charge a 30% penalty on people who buy health insurance after they have had a gap in coverage exceeding 63 days. The 30% penalty would apply for 12 months.
The individual mandate penalty does remain in effect for 2018. This Obamacare tax penalty calculator can help you calculate the penalty you would need to pay if you dont have health insurance.
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How We Conducted This Study
Our estimates use the Urban Institutes Health Insurance Policy Simulation Models baseline for 2022. HIPSM is a detailed microsimulation model of the health care system designed to estimate the cost and coverage effects of proposed health care policy options. The model simulates household and employer decisions and models the way changes in one insurance market interact with changes in other markets. HIPSM is designed for quick-turnaround analyses of policy proposals. It can be rapidly adapted to analyze various new scenarios from novel health insurance offerings and strategies for increasing affordability to state-specific proposals and can describe the effects of a policy option over several years.
HIPSM is based on two years of the American Community Survey, which provides a representative sample of families large enough for us to produce estimates for individual states and smaller regions, such as cities. The model is designed to incorporate timely, real-world data to the extent they are available. In particular, we regularly update the model to reflect published Medicaid and marketplace enrollment and costs in each state.
NOTES
1. The amounts are higher in Alaska and Hawaii.
2. Uninsurance is defined throughout this brief as lacking ACA minimal essential coverage both those with no coverage and those with short-term and limited-duration policies are considered uninsured. Similarly only those with minimal essential coverage are considered covered by insurance.
Revising The Premium Tax Credit
A key target in the ACA for those seeking change is the ACAâs progressive formula for determining tax credits in the marketplaces. It works like this: enrollees must contribute a maximum amount toward their premium, based on their income. If the benchmark plan premium exceeds that amount, enrollees receive the difference in the form of a tax credit. The logic of this approach is that enrollees are shielded from sharp increases in premiums. Critics, however, contend that this formula will be fiscally unsustainable over the long run. Several alternative proposals, including the AHCA, have advanced a âpremium-supportâ model, which sets tax credits independently of the premium.
RAND researchers evaluated two types of proposed tax credits
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