The Affordable Care Act - Implementation Timeline

In March 2010, Congress passed and the President signed into law the Affordable Care Act, which puts in place comprehensive health insurance reforms that will hold insurance companies accountable, lower costs, guarantee choice, and enhance quality health care for all Americans.  

Whether you get insurance through work, buy it yourself, have a small business, are on Medicare, or don't currently have insurance, the Affordable Care Act gives you control to make your own decisions about your health coverage.  It makes insurance more affordable by providing the largest middle class tax cut for health care in history, reducing premium costs for millions of families and small business owners who are priced out of coverage today.  This helps 32 million Americans afford health care who do not get it today -- and makes coverage more affordable for many more.  Under the plan, 94% of Americans will be insured.

To lower costs, the Affordable Care Act sets up a new competitive private health insurance market -- through state Exchanges --  giving millions of Americans and small businesses access to affordable coverage and the same choices of insurance that members of Congress will have.  It holds insurance companies accountable by keeping premiums down and preventing insurance industry abuses and denial of care, and it will end discrimination against Americans with pre-existing conditions. And, it puts our budget and economy on a more stable path by reducing the deficit by more than $100 billion over the next ten years -- and more than $1 trillion over the second decade--  by cutting government overspending and reining in waste, fraud and abuse.

Starting this year and continuing through 2014, the Affordable Care Act will be implemented, increasing access to affordable health care for individuals, families, seniors and businesses.  Many important benefits begin immediately, including bans on the worst insurance company abuses, cost savings for seniors, families and small and large businesses, and coverage options for many Americans who have been locked out of the insurance market because of a preexisting condition. 

This Year

New Consumer Protections 

• No Discrimination Against Children With Pre-Existing Conditions.  The new law includes new rules to prevent insurance companies from denying coverage to children with pre-existing conditions. Effective for health plan years beginning on or after September 23.   

• Prohibits Insurance Companies from Dropping Coverage.  In the past, insurance companies could search for an error on a customer's application or other technical mistake and use this error to stop covering the person when he or she got sick. The new law makes this illegal and after media reports cited incidents of breast cancer patients losing coverage, insurance companies agreed to end this practice immediately. Effective for health plan years beginning on or after September 23. Click here to learn more.

• Eliminating Lifetime Limits on Insurance Coverage. Under the new law, insurance companies will be prohibited from imposing lifetime dollar limits on essential benefits, like hospital stays.  Effective for health plan years beginning on or after September 23.  

• Regulating Annual Limits on Insurance Coverage.  Under the new law, insurance companies' use of annual dollar limits on the amount of insurance coverage a patient may receive is sharply restricted. In 2014, the use of annual dollar limits on essential benefits like hospital stays will be banned for new plans in the individual market and all group plans. Effective for health plan years beginning on or after September 23.  

• Appealing Insurance Company Decisions.  The law provides consumers with an easy way to appeal to their insurance company and to an outside board if the company denies coverage or a claim. Effective for health plan years beginning on or after September 23.  

• Information for Consumers Online. The law creates an easy to use website where consumers can compare health insurance coverage options and pick the plan that works for them. Effective July 1, 2010. Click here to learn more.

Improving Quality and Lowering Costs 

• Small Business Health Insurance Tax Credit.  Up to 4 million small businesses are eligible for tax credits to help them provide insurance benefits to their workers. The first phase of this provision provides a credit worth up to 35 percent of the employer's contribution to the employees' health insurance. Small non-profit organizations may receive up to a 25 percent credit. Effective now. Click here to learn more. 

• Relief for Four Million Seniors Who Hit the Medicare Prescription Drug "Donut Hole."  An estimated four million seniors who hit the gap in Medicare prescription drug coverage known as the "donut hole" this year will receive a $250 rebate. First checks mailed in June, 2010, and will continue monthly throughout 2010 as seniors hit the coverage gap.  Click here to learn more. 

• Free Preventive Care.  All new plans must cover certain preventive services such as mammograms and colonoscopies without charging a deductible, co-pay or coinsurance. Effective for health plan years beginning on or after September 23.  

• Preventing Disease and Illness.  A new $15 billion Prevention and Public Health Fund will invest in proven prevention and public health programs that can help keep Americans healthy -- from smoking cessation to combating obesity.  Funding begins in 2010. 

• Cracking Down on Health Care Fraud. Current efforts to fight fraud have returned more than $2.5 billion to the Medicare Trust Fund in FY 2009 alone. The new law invests new resources and requires new screening procedures for health care providers to boost these efforts and reduce fraud and waste in Medicare, Medicaid, and CHIP.  Many provisions effective now. Click here to learn more.

Increasing Access to Affordable Care 

• Access to Insurance for Uninsured Americans with Pre-Existing Conditions.  A transitional high risk pool program will provide new coverage options to individuals who are uninsured because of a pre-existing condition for at least six months. States have the option of running their own temporary high risk pool. If a state chooses not to do so, a pool will be established by the Department of Health and Human Services.  National pool effective July 1. Click here to learn more. 

• Extending Coverage for Young Adults.  Under the new law, young adults will be allowed to stay on their parents' plan until they turn 26 years old unless they are offered insurance at work. While the provision takes effect in September, most insurance companies have already implemented this new practice. Check with your insurance company or employer to see if you qualify. Effective for health plan years beginning on or after September 23. Click here to learn more. 

• Coverage for Early Retirees.  Too often, Americans who retire without employer-sponsored insurance and before they are eligible for Medicare see their life savings disappear because of exorbitant rates in the individual market. To preserve employer coverage for early retirees until more affordable coverage is available through the exchanges in 2014, the new law creates a $5 billion program to help people who retire before age 65 maintain the affordable care they need. Applications for employers to participate in the program available June 1. Click here to learn more. 

• Rebuilding the Primary Care Workforce.  To strengthen the primary care workforce, new incentives in the law to expand the number of primary care doctors, nurses and physician assistants include funding for scholarships and loan repayments for primary care doctors and nurses working in underserved areas. Doctors and nurses with student loans will also receive tax relief if they practice in communities with a shortage of health care providers. Effective 2010. 

• Holding Insurance Companies Accountable for Unreasonable Rate Hikes.  The law allows states that have or plan to implement measures that require insurance companies to justify their premium increases will be eligible for $250 million in new grants and insurance companies with excessive or unjustified premium exchanges may not be able to participate in the new health insurance Exchanges in 2014.  Grants will be awarded beginning in 2010. 

• Allowing States to Cover More People on Medicaid.  States will receive increased federal matching funds for covering low-income individuals and families on Medicaid. This will make it easier for states that choose to do so to cover more of their residents. Effective April 1, 2010. 

• Payments for Rural Health Care Providers.  Today, 68 percent of medically underserved communities across the nation are in rural areas, and these communities often have trouble attracting and retaining medical professionals. The law provides rural health care providers the payments they need and ensures they can continue to serve their communities.  Effective 2010.

2011

Improving Quality and Lowering Costs 

• Prescription Drug Discounts. Seniors who fall in the coverage gap will receive a 50 percent discount when buying Medicare Part D covered brand-name prescription drugs. Over the next ten years, seniors will receive additional savings on brand-name and generic drugs until the coverage gap is completely closed in 2020. Effective January 1, 2011. Click here to learn more. 

• Free Preventive Care for Seniors.  The law provides certain free preventive services, such as annual wellness visits and personalized prevention plans for seniors on Medicare.  Effective January 1, 2011. 

• Improving Health Care Quality and Efficiency.  The law establishes a new Center for Medicare & Medicaid Innovation that will begin testing new ways of delivering care to patients that improve the quality of care, and reduce the rate of growth in health care costs for Medicare, Medicaid, and the Children's Health Insurance Program (CHIP). Additionally, by January 1, 2011, HHS will submit a national strategy to improve the quality of care provided by these programs.    Effective January 1, 2011. 

• Improving Care for Seniors After They Leave the Hospital. The Community Care Transitions Program will help high risk Medicare beneficiaries who are hospitalized avoid unnecessary readmissions to the hospital by coordinating care and connecting patients to services in their communities. Effective January 1, 2011.  

• New Innovations to Bring Down Costs.  The Independent Payment Advisory Board will begin operations to develop and submit proposals to Congress and the President aimed at protecting and improving benefits for seniors and extending the life of the Medicare Trust Fund. It will target waste in the system, reduce costs, improve health outcomes for patients, and expand access to high-quality care.  Administrative funding becomes available October 1, 2011. 

Increasing Access to Affordable Care 

• Increasing Access to Services at Home and in the Community.  The new Community First Choice Option allows States to offer home and community based services to disabled individuals through Medicaid rather than institutional care in nursing homes.  Effective October 1, 2011. 

• Strengthening Community Health Centers.  The law includes new funding to support the construction of and expand services at community health centers, allowing these centers to serve some 20 million new patients across the country.  Effective 2011.

Holding Insurance Companies Accountable 

• Bringing Down Health Care Premiums.  To ensure premium dollars are spent on health care, the new law requires that at least 85% of all premium dollars collected by insurance companies for large employer plans are spent on health care services and health care quality improvement.  For plans sold to individuals and small employers, at least 80% of the premium must be spent on benefits and quality improvement. While insurance companies must use some money to administer their plans -- and do things like prevent fraud and  improve information technology -- the Affordable Care Act ensures that insurance companies spend more on patients and less on paperwork and overhead. Plans that spend too much on overhead must provide rebates to consumers. Rebates begin no later than January 1, 2011. 

• Addressing Overpayments to Big Insurance Companies and Strengthening Medicare Advantage.  Today, Medicare pays Medicare Advantage insurance companies over $1,000 more per person on average than Original Medicare. These additional payments are paid for in part by increased premiums paid by all Medicare beneficiaries, including 77 percent of seniors not enrolled in a Medicare Advantage plan. The new law levels the playing field by gradually eliminating Medicare Advantage overpayments to insurance companies. Seniors in a Medicare Advantage plan will still receive guaranteed Medicare benefits and the law provides bonus payments to Medicare Advantage plans that provide high quality care.  Effective January 1, 2011.  Click here to learn more.

2012

Improving Quality and Lowering Costs

• Linking Payment to Quality Outcomes.  The law establishes a hospital Value-Based Purchasing program (VBP) in traditional Medicare. This program offers financial incentives to hospitals to improve the quality of care. Hospital performance is required to be publicly reported, beginning with measures on treating heart attacks, heart failure, pneumonia, surgical care, health-care associated infections, and patients' perception of care. Effective October 1, 2012. 

• Encouraging Integrated Health Systems.  The new law provides incentives for physicians to join together to form "Accountable Care Organizations," through which doctors can better coordinate patient care and improve the quality, help prevent disease and illness and reduce unnecessary hospital admissions. If Accountable Care Organizations provide high quality care and reduce costs to the health care system, they can keep some of the money that they have helped to save. Effective January 1, 2012. 

• Reducing Paperwork and Administrative Costs.  Health care remains one of the few industries that relies on paper records. The new law will institute a series of changes to standardize billing and requires health plans to begin adopting and implementing rules for the secure, confidential, electronic exchange of health information. Using electronic health records will reduce paperwork and administrative burdens, cut costs, reduce medical errors and most importantly, improve the quality of care. First regulation effective October 1, 2012. 

• Understanding and Fighting Health Disparities. To help understand and combat persistent health disparities, the law requires any ongoing or new Federal health program to collect and report racial, ethnic and language data. The Secretary of Health and Human Services will use this data to help identify and fight disparities. Effective March, 2012.

Increasing Access to Affordable Care 

• Providing New, Voluntary Options for Long-Term Care Insurance.  The law creates a voluntary long-term care insurance program -- called CLASS -- to provide cash benefits to adults who become disabled.  Effective October 1, 2012.

2013

Improving Quality and Lowering Costs 

• Improving Preventive Health Coverage.  To expand the number of Americans receiving preventive care, the law provides new funding to state Medicaid programs that choose to cover preventive services for patients at little or no cost.  Effective January 1, 2013.  

• Expanded Authority to Bundle Payments. The law establishes a national pilot program to encourage hospitals, doctors, and other providers to work together to improve the coordination and quality of patient care.  Under payment "bundling," hospitals, doctors, and providers are paid a flat rate for an episode of care rather than the current fragmented system where each service or test is billed separately to Medicare.  For example, instead of a surgical procedure generating multiple claims from multiple providers, the entire team is compensated with a "bundled" payment that provides incentives to deliver health care services more efficiently while maintaining or improving quality of care.  It aligns the incentives of those delivering care, and savings are shared between providers and the Medicare program.  Effective January 1, 2013.

Increasing Access to Affordable Care 

• Increasing Medicaid Payments for Primary Care Doctors.  As Medicaid programs and providers prepare to cover more patients in 2014, the Act requires states to pay primary care physicians no less than 100 percent of Medicare payment rates in 2013 and 2014 for primary care services. The increase is fully funded by the federal government. Effective January 1, 2013. 

• Additional Funding for the Children's Health Insurance Program.  Under the new law, states will receive two more years of funding to continue coverage for children not eligible for Medicaid.  Effective October 1, 2013.Click here to learn more.

2014

New Consumer Protections 

• No Discrimination Due to Pre-Existing Conditions or Gender. The law implements strong reforms that prohibit insurance companies from refusing to sell coverage or renew policies because of an individual's pre-existing conditions. Also limits the ability of insurance companies to charge higher rates due to gender, health status, or other factors. Effective January 1, 2014. 

• Eliminating Annual Limits on Insurance Coverage.  The law prohibits plans from imposing annual dollar limits on the amount of coverage an individual may receive.  Effective January 1, 2014. 

• Ensuring Coverage for Individuals Participating in Clinical Trials. Insurers will be prohibited from dropping or limiting coverage because an individual chooses to participate in a clinical trial.  Applies to all clinical trials that treat cancer or other life-threatening diseases.  Effective January 1, 2014.

Improving Quality and Lowering Costs 

• Makes Care More Affordable.  The act includes tax credits to make it easier for the middle class to afford insurance will become available for people with incomes above 100 percent and below 400 percent of poverty ($43,000 for an individual or $88,000 for a family of four in 2010) who are not eligible for or offered other affordable coverage.  These individuals may also qualify for reduced cost-sharing (e.g. copayments, coinsurance, and deductibles).  Effective January 1, 2014. 

• Establishing Health Insurance Exchanges.  The law calls for health insurance exchanges to open in each State to enable all Americans to easily shop for more affordable private insurance.   Plans offered in the exchange provide at least a basic level of benefits and services. The Exchanges will increase competition and consumer choice, make our health insurance marketplace more transparent and help bring down costs. Effective January 1, 2014. 

• Small Business Tax Credit.  The law implements the second phase of the small business tax credit for qualified small businesses and small non-profit organizations. In this phase, the credit is up to 50 percent of the employer's contribution to provide health insurance for employees.  There is also up to a 35 percent credit for small nonprofit organizations.  Effective January 1, 2014. Click here to learn more.

Increasing Access to Affordable Care 

• Increasing Access to Medicaid.  Americans who earn less than 133 percent of poverty (approximately $14,000 for an individual and $29,000 for a family of four) will be eligible to enroll in Medicaid. States will receive 100 percent federal funding for the first three years to support this expanded coverage, phasing to 90 percent federal funding in subsequent years. Effective January 1, 2014. 

• Promoting Individual Responsibility.  Under the new law. most individuals who can afford it will be required to obtain basic health insurance coverage or pay a fee to help offset the costs of caring for uninsured Americans.  If affordable coverage is not available to an individual, they will be eligible for an exemption.  Effective January 1, 2014. 

• Ensuring Free Choice.  Workers who cannot afford the coverage provided by their employer may take whatever funds their employer might have contributed to their insurance and use these resources to help purchase a more affordable plan in the new health insurance exchanges.  Effective January 1, 2014.

2015

Improving Quality and Lowering Costs 

• Paying Physicians Based on Value Not Volume.  A new provision will tie physician payments to the quality of care they provide. Physicians will see their payments modified to reflect the quality of care they provide so that providers who provide higher value care will receive higher payments than those who provide lower quality care.  Effective January 1, 2015.