Money Matters

Breaking through the political clutter: Preparing for the financial effects of the Affordable Care Act 

Provided by RBC Wealth Management
and Dave Dupont

Government shutdown. Debt ceiling. Mortgage Crisis. Recession. Obamacare.

Have you tuned out yet? If you’re like most Americans, the answer is a resounding “yes.” Each of these terms is tossed around within the construct of a seemingly never-ending, interconnected stream of politically-charged debates. Lost in the clutter are the tangible details most suited to help you manage their effect on your daily life.

The Patient Protection and Affordable Care Act (PPACA), commonly called the Affordable Care Act (ACA) or Obamacare, is a United States federal statute signed into law by President Barack Obama on March 23, 2010.

The ACA aims to increase the quality and affordability of health insurance, lower the uninsured rate by expanding public and private insurance coverage and reduce the costs of healthcare for individuals and the government. The law also requires insurance companies to cover all applicants within new minimum standards and offer the same rates regardless of preexisting conditions or gender. Additional reforms aim to reduce costs and improve healthcare outcomes by shifting the system toward quality over quantity through increased competition, regulation and incentives to streamline the delivery of healthcare.

Despite being passed as a law more than four years ago, the most noticeable changes didn’t start until recently. Regardless of varying political stances or personal opinions, the law is in effect and your health care coverage options may now look different. And the financial impact of those changes truly depends on your financial situation.

As you consider your next step, take time to consider these details that are often under-reported amidst the deluge of media coverage:

Same law, different names — Recent polls have shown much confusion over the name of the law itself. Understand that whether you hear the term Patient Protection and Affordable Care Act, PPACA, Affordable Care Act, ACA or Obamacare — it’s all the same law!

Understand your options — By now if you’re currently employed or a business owner, you’ve received information about your next steps in the private market. For those not in this category or if you’re looking for more information on your options in the marketplace, visit the official website at www.healthcare.gov

Wealth management planning — As noted, the new law could affect your out-of-pocket expenses in either direction. Regardless of whether you have more or less money in your pocket, consumer-driven health plans can be advantageous for you provided you have a solid wealth management plan that helps you prepare for and mitigate unexpected medical needs down the road. Consult your financial advisor to prepare for these possibilities.

Despite the fact that many of us understand the importance of new laws, constant chatter in the media can render news about them easily ignorable white noise. However, becoming knowledgeable about your own health and financial future can go a long way toward helping you make an informed decision with little cause for surprise down the road.