Despite criticism, ACA has helped many access health insurance

Many discussions about the Affordable Care Act (ACA) include a list of ways the law has failed to help Americans get more affordable and comprehensive health insurance. What’s left out, therefore, are all the ways the law has helped Americans get better coverage and improved health.

This is the third story in a series.

In the first two parts of this series on the ACA (here and here), we reported on how Americans have benefited from the law, known officially as the Patient Protection and Affordable Care Act, and unofficially, as Obamacare.

In part three of this series, we explain these features of the ACA:

• Cost-sharing reductions
• Low-cost coverage for American Indians and Alaska Natives
• The Basic Health Programs
• Internal and external appeals
• Community rating
• Medical loss ratio rebates.

Cost-sharing reductions

ACA critics often note the high cost of ACA coverage, a criticism that was mostly accurate when the law became fully effective in 2014. Since 2021, however, Congress has made Obamacare coverage more affordable in two significant ways. First, lawmakers included more funding for premium subsidies, as we explained in part one. Second, Congress allowed low-income Americans to qualify for cost-sharing reductions to reduce enrollees’ out-of-pocket costs.

“This year, about half the people with ACA marketplace coverage have cost-sharing reductions,” said Louise Norris, an ACA expert and health insurance broker in Colorado. “The premium subsidies are an important way to make health insurance premiums affordable, and the cost-sharing reductions help to make it affordable when you use your coverage because they help you pay for your deductible, co-payments and coinsurance.”

Cost-sharing reductions vary based on household income and state of residence, as KFF explained. In the American Rescue Plan Act of 2021 and the Inflation Reduction Act of 2022, Congress improved the cost-sharing reductions. Lawmakers recognized that consumers earning 150% of the Federal Poverty Level (FPL) would need to make no more than $48,225 for a family of four, Norris added. That means that the family might have had low premium rates but still may need to spend $9,000 in out-of-pocket costs annually, she explained, adding, “That wouldn’t make sense.”

Low costs for American Indians and Alaska Natives

The ACA includes special protections for any member of a federally recognized American Indian or Alaska Native tribe or a shareholder in a corporation under the Alaska Native Claims Settlement Act (ANCSA) of 1971. “The ACA definitely boosted access to coverage and care for American Indians and Alaska Natives,” Norris commented.

American Indian and Alaska Native enrollees get cost-sharing reductions on any Marketplace plan, which is more generous than the ACA provisions for other low-income consumers, she added. “If their income is up 300% of the poverty level, they get full cost-sharing reductions, meaning they don’t have any out-of-pocket costs.” Also, American Indian and Alaska Native consumers can enroll year-round, she noted. For a family of four, 300% of FPL is $96,430 this year.

The ACA also made permanent the Indian Health Care Improvement Act of 1976, which authorizes the Indian Health Service (IHS) for American Indians and Alaska Natives. These provisions are important because a large portion of these consumers get their health care through the IHS, and because the ACA gives American Indian and Alaska Native consumers special benefits under Medicaid, the Children’s Health Insurance Program and in ACA Marketplaces, as healthcare.gov explains.

The Basic Health Programs

Although the Basic Health Programs (BHPs) operate in only three states (Minnesota, New York and Oregon), they cover the same essential health benefits that the ACA covers and tend to have low cost-sharing requirements and either free or low-cost premiums, Norris said. Any state can start a BHP to provide health insurance to those who might earn too much to qualify for Medicaid, she added.

“In Oregon and Minnesota, they go up to 200% FPL, and in New York, those with income up to 250% of FPL can enroll,” Norris explained. For a family of four this year, 200% of FPL is $64,300 and 250% is $80,375.

“If you’re in any of those states and within those income ranges but earn too much to qualify for Medicaid, you can get Basic Health Program coverage,” Norris added. Coverage in a BHP is similar to Medicaid in terms of how much it costs consumers, and provides robust coverage, including the essential health benefits available to consumers with ACA plans, she noted.

If a consumer enrolls in a BHP and his or her income rises above 200% or 250% of FPL that consumer could enroll in an ACA Marketplace plan, she added.

Internal and external appeals

As we have seen over the past few years, the right to appeal health insurers’ adverse decisions is critically important for all consumers, and since 2010, the ACA has allowed all consumers (except those in grandfathered health plans) the right to appeal denied claims, Norris said.

The first appeal goes to internal reviewers at the consumer’s health plan, according to this KFF report from Karen Politz. Then, if the plan upholds its  denial, the appeal goes to an independent outside reviewer, sometimes called an independent review organization (IRO), she added.

Before the ACA went into effect, consumers had the right to external appeals in most states, but that right did not extend to those enrolled in self-insured group health plans, such as from an employer, Politz explained. The federal Employee Retirement Income Security Act (ERISA) of 1974 pre-empts states from enacting laws that govern privately insured health plans, as we explained here.

“Giving people the right to an internal and external appeal when a claim is denied or a consumer gets an adverse decision, is a big deal,” Norris commented. “Maybe your health plan didn’t put much effort into your internal appeal, and if you didn’t know you had the right to an external appeal, it would end there. And most people don’t appeal perhaps because they don’t know they have that right.”

Two other ACA features

Of the two other ACA features, community rating is important because until the ACA became fully effective in 2014, health insurers set each consumer’s risk based on an individual’s earlier or expected health costs in the individual and small-group markets, as Norris wrote on healthinsurance.org. In 2014, however, health insurers could vary premiums based only on an applicant’s age, location and in most states on tobacco use, she added.

One other feature is rebates under the medical loss ratio rules in the ACA. The law requires insurers to spend at least 80% or 85% of premium income on medical care. If an insurer fails to do so, it must provide rebates to plan members, according to this explanation from the federal Centers for Medicare and Medicaid Services (CMS).

Last year, insurers issued $1.1 billion in rebates, $950 million in 2023 and $1 billion in 2022, according to KFF.

Resources

• Enrollment Growth in the ACA Marketplaces, KFF, April 2, 2025.
• 15 years later: The Affordable Care Act’s impact and the fight to keep it intact, Megan Sayles, Afro News, March 26, 2025.
• The Affordable Care Act at Fifteen: Policy Surprises and Lessons, Health Affairs, March 20, 2025.
• After Another Record Year for ACA Enrollment, What’s Next for the Marketplaces?, KFF, Jan. 15, 2025.
• Consumer Appeal Rights in Private Health Coverage, Karen Politz, KFF, Dec. 10, 2021.