What is the 'Affordable Care Act'

The Affordable Care Act is a federal statute signed into law in March, 2010 as a part of the healthcare reform agenda of the Obama administration. Signed under the title of The Patient Protection and Affordable Care Act, the law included multiple provisions that would take effect over a matter of years, including the expansion of Medicaid eligibility, the establishment of health insurance exchanges and prohibiting health insurers from denying coverage due to pre-existing conditions.

BREAKING DOWN 'Affordable Care Act'

At the time of its enactment, the Congressional Budget Office estimated that the new law would reduce the federal deficit by nearly $145 billion in the first 10 years and between 0.25% and 0.5% of GDP thereafter. The costs associated with the new amendments are offset by numerous taxes, such as increased taxes on items and services such as eye glasses, hearing aids and indoor tanning. Government data suggests that over 20 million Americans benefited from insurance coverage under this law as of March 2016.

On January 20, 2017, in his first executive order after taking office, President Donald Trump signaled his intention to de-fund the Affordable Care Act saying executive agency heads should "delay the implementation of any provision or requirement of the Act that would impose a fiscal burden on any State." The intention of this order is to signal the first phase of Republican efforts to repeal and replace the ACA. Rolling back the law was one of Trump's central campaign promises aimed at reducing the fiscal burden on the government.

RELATED TERMS
  1. Health Insurance

    Health insurance is a type of insurance coverage that pays for ...
  2. Pre-Existing Condition

    A pre-existing condition is any personal illness or health condition ...
  3. Minimum Essential Coverage

    Minimum Essential Coverage is the type of health insurance policy ...
  4. Trumponomics

    Trumponomics is a term for the economic policies of President ...
  5. Long-Term Care (LTC) Insurance

    Long-term care insurance coverage provides for the care of people ...
  6. Administrative Law

    Administrative law is the body of law that governs the regulation ...
Related Articles
  1. Insights

    A Real Solution for the Health Insurance Market

    It's time for our representatives to come together and find a healthcare solution for everyone.
  2. Insurance

    What Happens if Obamacare Is Repealed?

    The repercussions of de-funding the Affordable Care Act will be significant.
  3. Insurance

    How Obamacare Can Be Repealed

    There are several ways that the Republican-led Congress and the next president can repeal Obamacare. Here's a look at possible scenarios.
  4. Insurance

    Why Health Insurance Premiums Will Rise in 2017

    To battle the costs and challenges of the Affordable Care Act, many health insurances are raising their premiums in 2017.
  5. Insurance

    4 Ways to Find Good Health Insurance

    Follow these 4 steps to get the best coverage at the most affordable price.
  6. Insurance

    Where to Find Affordable Health Insurance

    The cost of medical services can hit the wallet hard: there are 1.7 million personal bankruptcies every year due to inability to pay medical bills.
  7. Insights

    CBO: 14M to Lose Healthcare by 2018 Under GOP Plan

    House Speaker Ryan's Obamacare replacement would dramatically reduce health insurance coverage, according to a nonpartisan government think tank.
  8. Insurance

    The Tax Implications of Fully Repealing the ACA

    Repealing the Affordable Care Act would have a financial effect on individuals and employers.
  9. Insurance

    Trump, Healthcare and Insurers: What Comes Next

    Here's how Donald Trump's plans to radically overhaul health insurance could impact insurance firms.
RELATED FAQS
  1. Can my insurance company refuse me coverage?

    Insurance isn't always as straightforward as other products, and insurers can deny coverage in many different instances. Read Answer >>
Hot Definitions
  1. Economies of Scale

    Economies of scale refer to reduced costs per unit that arise from increased total output of a product. For example, a larger ...
  2. Quick Ratio

    The quick ratio measures a company’s ability to meet its short-term obligations with its most liquid assets.
  3. Leverage

    Leverage results from using borrowed capital as a source of funding when investing to expand the firm's asset base and generate ...
  4. Financial Risk

    Financial risk is the possibility that shareholders will lose money when investing in a company if its cash flow fails to ...
  5. Enterprise Value (EV)

    Enterprise Value (EV) is a measure of a company's total value, often used as a more comprehensive alternative to equity market ...
  6. Relative Strength Index - RSI

    Relative Strength Indicator (RSI) is a technical momentum indicator that compares the magnitude of recent gains to recent ...
Trading Center