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Affordable Care Act - How it impacts you and your family

The impact of the Patient Protection Act on you and your family depends to a large extent on your age, for whom you work, the amount and sources of your income and your health status:

1. Young Adults: Beginning in 2014, young adults will have to purchase health insurance unless they qualify for an exemption. Young adults under age 30, however, will have access to less expensive catastrophic coverage. In addition, since 2010, young adults up to age 26 have been allowed to stay on their parent’s health plans.

2.  Non-Elderly Adults: Unless they qualify for an exemption, beginning in 2014, all U.S. citizens and legal residents will be required to have qualifying health care coverage or pay a penalty…the individual mandate. Insurers will no longer be able to turn down people with pre-existing conditions or charge them higher premiums. Health insurance plans cannot impose annual limits on the amount of coverage an individual may receive and premium rating variations can be based only on age, premium rating area, family composition and tobacco use. Lower-income earners who earn less than 400% of the federal poverty level will be eligible for subsidies to help purchase coverage. The lowest-income earners (up to 138% of the federal poverty level) will become eligible for Medicaid, regardless of whether or not they have children or a disability, if the state in which they reside has elected to participate in the ACA Medicaid expansion.

3. Employees of Large Companies: Participation in an employer’s large group health plan generally will satisfy the individual mandate. Beginning in 2015, companies with 50 or more employees will not be required to provide health care coverage, but those that don’t may have to make “shared responsibility payments.” Existing benefit packages are grandfathered, but must still meet certain requirements. New plans will have to meet minimum requirements, including limits on out-of-pocket spending.

4. Employees of Small Companies: A business with fewer than 50 employees is not required to provide health care coverage. A business with 25 or fewer employees, however, may qualify for a federal tax credit to help with the cost of providing health insurance.

5. Higher-Income Individuals: Beginning in 2013, additional Medicare taxes will be paid by higher-income individuals on their wages and, for the first time, on net investment income.

6. Senior Citizens: Medicare has added free preventive services and the Medicare Part D prescription drug coverage gap will slowly be closed by 2020. Higher-income Medicare beneficiaries will pay higher Medicare Part B premiums for medical insurance. Medicare currently covers about 38 million people and, as a result, has tremendous clout in the way medical care providers are paid. As a result, expect to see Medicare pilot programs designed to develop and implement new approaches to how medical care providers are compensated.

Just Ask Freeman any questions you have about the ACA and its impact on your retirement: (301) 627-0123

Learn more about Affordable Care Act (ACA) here.