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5 points to know about the health care overhaul

About half of the people surveyed recently by

About half of the people surveyed recently by the Kaiser Family Foundation believe they didn’t have enough information to understand how the new health care overhaul will affect their family's medical future. Credit: iStock

Still a little hazy about the health care overhaul? You have plenty of company.

About half the people surveyed this spring by the nonpartisan Kaiser Family Foundation felt they didn't have enough information to understand how the law will affect their family. Among those with an annual household income of less than $30,000, some 30 percent thought the law had been repealed by Congress or the Supreme Court.

That's the low-income demographic the law is designed to help the most as it extends insurance coverage to millions of uninsured people.

With those results in mind, here are five key points everyone should know about the overhaul, heading into this fall and 2014, when major changes start to unfold.

1. The law is in effect: Congress passed President Barack Obama's health care law in March 2010, and the overhaul has since survived 37 attempts by Republicans in the House of Representatives to eliminate, defund or partly scale it back.

The law, known as the Affordable Care Act or ACA, also survived a more substantial test last year when the Supreme Court upheld its constitutionality. However, the court's ruling gave states the right to decide whether to expand Medicaid, the federal-state funded program that covers the needy and disabled people. Medicaid plays a key role in the ACA's plan to provide insurance coverage to more Americans.

2. You will be required to have coverage: The overhaul mandates that, starting next year, most U.S. citizens and legal residents obtain coverage or pay a penalty. The annual penalty starts at $95 per adult, or 1 percent of family income -- whichever is greater -- and then rises over the next few years.

3. Major milestones are looming: Next year, the ACA will take two major steps toward its goal of providing more individuals with insurance coverage. Medicaid will be expanded in states that allow it, and many people will be able to buy coverage using income-based tax credits.

These tax credits, or subsidies, are reserved for people who can't get health insurance through an employer and who don't qualify for Medicaid, Medicare or military-based coverage.

State-based benefits exchanges will debut in October and they will enable consumers to go online to compare 2014 coverage terms and prices and then use tax credits, if they qualify, to buy a policy.

4. Financial help extends to the middle class: The tax credits or subsidies will be available to help individuals and families making up to four times the federal poverty level. For 2013, that equates to an income of $94,200 for a family of four.

The tax credits will be doled out on a sliding scale. That means individuals with incomes closer to the poverty guideline will receive bigger credits.

Starting next year, the ACA also will help individuals get coverage regardless of their health. Currently, if you already have a medical condition, insurers can either reject your application or charge a much higher price.

5. Insurance prices may change: Health insurers are warning that premiums, or the cost of coverage, could soar for some people due to a number of factors. Those include taxes and fees, as well as coverage requirements the law imposes.

The extent of any price hikes will depend on many variables, such as where people live, their current coverage and health and their age.

Young, healthy people who currently have low-cost coverage may see some of the biggest hikes in part because the law limits the price differences an insurer can charge a person based on age.

Insurers generally charge seniors more because they tend to generate more expensive claims.

About 149 million individuals have employer-sponsored health coverage in the United States, making it the largest source of coverage. Those who work for big companies may not see a lot of change, at least initially.

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