What is Obamacare?
Obamacare is a law passed during Barack Obama’s presidency. It reforms the US healthcare system. Its real name is the Patient Protection and Affordable Care Act (ACA). It was signed into law by the President in March 2010 and has been in force since January 2014. It forms an important part of the reform of the social protection system in the United States along with the “Health Care and Education Reconciliation Act”.
This reform brings new obligations for insurers, who must offer at least the following 10 benefits in their contracts:
- Ambulatory services,
- Emergency services,
- Hospitalization,
- Childbirth and newborn care,
- Mental health,
- Medical prescriptions,
- Rehabilitation services,
- Laboratory analyses,
- Chronic disease prevention and management,
- Pediatric services.
The aim of this law was to enable as many Americans as possible to benefit from health coverage. This means that American citizens are obliged to take out health insurance with a private insurer listed on the government website Healthcare.gov.
In return for this obligation, the government helps citizens who cannot afford to take out private health insurance by providing tax breaks to enable them to pay for this coverage and thus gain access to healthcare. The cost of healthcare in the USA is very high, and rising all the time: you can expect to pay 120 dollars (105 euros) for a consultation with a general practitioner. Many Americans couldn’t afford healthcare, let alone social security coverage. Before the Obamacare law, some twenty million Americans lived without health insurance; by 2016 this figure had fallen to 8.9%.
Obamacare repeal?
The US Senate has rejected the repeal of Obamacare called for by President Trump when he took office in January 2017. In fact, the (Republican-majority) House of Representatives opposes repeal aimed at doing away with the Obamacare law.
This legislation is therefore still in place, but Donald Trump introduced the Tax Cuts and Jobs Act (TCJA) executive order in December 2017. This executive order cancels individual penalties linked to the obligation to take out private health insurance.
Despite this, 5 states have decided to reinstate these penalties, also known as individual mandate tax penalties.
Which states are affected and which penalties are in force?
Individual mandates require permanent legal residents, foreign nationals and their families residing in the United States to take out private “minimum essential coverage” (MEC). Failure to do so may result in financial penalties for citizens of these states.
The five states affected by Obamacare-related penalties are: California (CA), New Jersey (NJ), District of Columbia (DC), Massachusetts (MASS) and Rhode Island (RI). Vermont (VT) is considering it, but has not yet finalized the penalty amounts.
Does Obamacare affect expatriates?
Obamacare made it compulsory for all American residents, including expatriates, to take out health insurance.
Insurance is essential, as healthcare costs are very high in the USA and continue to rise year on year, but you can now take out insurance with a French insurer.
In the 5 states concerned by individual mandates, there are solutions that will enable you to comply with current regulations, even if you are insured with a French insurer. In fact, certain conditions may allow you to be exempted from the obligation to take out private American health insurance. Our international health insurance experts can help you with all the necessary formalities.
In brief….
ean-Christophe Pandolfi, CEO of santexpat.fr and a former expatriate in the USA, explains the key points of Obamacare, the states where penalties are still in force, and the solutions offered by santexpat.fr to help you with your healthcare in the USA. Whatever your state of residence in the USA, we have solutions for you.
