Transamerica Institute

Affordable Care Act Categories of Consumers 

The following guide explains how different types of health care consumers are affected by the individual mandate of the Affordable Care Act.

The Uninsured

Under the ACA, every American must have insurance beginning in 2014 – purchased as an individual/family, through their employer, or through a government program – or pay a penalty when paying their federal income taxes. Many people that buy insurance through the new State Exchanges will be eligible for tax incentives, subsidies, and/or Medicaid, based on their income.

Consumers can purchase health insurance through their State Exchange or through the traditional insurance market.  If you decide to purchase health insurance through the exchange, you need to do so  during the Open Enrollment Period of each year in order to get coverage and avoid paying the penalty. The Open Enrollment Period for 2015 coverage ended February 15, 2015, but you may qualify for a Special Enrollment Period. Visit Healthcare.gov to see if you qualify.

Individuals with Employer-based Coverage

You do not need to do anything to comply with the ACA.  However, you may qualify for a tax rebate if your insurance is deemed unaffordable or inadequate, based on your income. You may seek other options in your State Exchange or in the traditional insurance market. 

Individuals with Private Health Insurance

You do not need to do anything to comply with the ACA.  You may however, compare pricing in your State Exchange or seek other options in the traditional health insurance market.  You may also be eligible for tax incentives, subsidies, or Medicaid. Only plans purchased through an Exchange make you eligible for tax incentives.

Medicare Recipients

You do not need to do anything. The State Exchange will not affect your Medicare choices, and your benefits WILL NOT CHANGE. No matter whether you have Medicare or a Medicare Advantage Plan, you will still have the same benefits and security you have now. You will not have to make any changes.  Medicare’s Open Enrollment Period (October 15-December 7) has not changed.

As of 2010, Medicare benefits have expanded under the ACA – medical treatments such as preventive benefits with no out of pocket costs, cancer screenings, and an annual wellness visit apply to all health plans. Click here to learn more about Medicare.

Note: The Exchanges do not offer Medicare supplement (Medigap) insurance or Medicare Part D prescription drug plans. For information on these programs, visit Medicare.gov

Medicaid Recipients

You do not need to do anything.  Many states are expanding Medicaid, so if you did not qualify based on income in the past, you may qualify now. Medicaid provides health coverage for low-income families and children, pregnant women, the elderly, and individuals with disabilities. Medicaid programs must follow federal guidelines, but they vary somewhat from state to state.

Adults Age 26 and Younger

As of 2010, you may be able to obtain health insurance through an insured parent’s plan, if their plan provides dependent benefits.  An adult child may join coverage during a plan’s Open Enrollment Period or during other special enrollment opportunities. The employer or insurance company can provide details.

You can join, remain, or return to a parent’s plan, up to age 26, even if you are:

  • married
  • not living with your parents
  • attending school
  • financially independent

If your parent’s insurance does not provide dependent benefits, you are able to buy insurance through the new State Exchange for yourself or your family.  In this marketplace, you can compare private health insurance plans based on price and level of coverage.  You can also seek other options through the traditional health insurance market. Visit our 50 State Exchange page for an overview and details on how to enroll in your specific state, or check out our College Students Health Care Options guide.

Individuals With a Pre-existing Condition

Starting in 2014, health insurance plans cannot refuse to cover you or charge you more just because you have a pre-existing health condition.  An insurance company cannot turn you down or charge you more because of your condition. Once you have insurance, the plan cannot refuse to cover treatment for pre-existing conditions.  This is true even if you have been turned down or been refused coverage due to a pre-existing condition in the past. Similarly, private health plans in the traditional health insurance market  as well as plans in the State Exchanges cannot deny you coverage due to a pre-existing condition.

In addition, Medicaid and the Children's Health Insurance Program (CHIP) cannot refuse to cover you or your children, or charge you more because of a pre-existing health condition.

Small Business Owners

Under the ACA, small businesses with less than 50 full time equivalent employees WILL NOT BE REQUIRED to provide health insurance to their employees. They will have the option of purchasing health insurance through the new Small Business Health Options Program (SHOP) marketplace or seek other options through the traditional insurance market.  The SHOP is the the equivalent of the State Exchange but for small businesses.  Visit our Small Business Health Options Program page for more information, or learn about Small Business Affordable Care Act Tax Credits.