ACA-Compliant vs. Non-ACA-Compliant Insurance Plans: Choosing the Best Fit for Your Family

The Affordable Care Act (popularly known as ObamaCare’s) journey towards becoming a law officially began in July 2009 when the House Speaker, Nancy Pelosi, and other Democrats from the House of Representatives revealed their intentions to overhaul the healthcare system. The House of Representatives recognized the ACA as a law on November 7, 2009, and received Senate approval on March 21, 2010. Finally, President Barack Obama gave the ACA his official stamp of approval on March 23, 2010, making it a law.

At their core, the ACA’s provisions intend to expand insurance access, strengthen consumer protection, and emphasize the importance of wellness and protection programs. Over ten years after its conception, members of the Trump administration have reformed the Affordable Care Act. Some of those changes include lowering the penalties for not reducing insurance coverage to $0, repealing cost-sharing subsidies, cutting federal funding for sign-ups, and expanding access to short-term plans.

Understanding the impacts of these amendments translates to more informed decision-making. If you’re currently shopping for health insurance plans to meet your family’s healthcare needs, start by weighing the pros and cons of ACA-compliant and Non-ACA-Compliant health insurance plans.

What is an ACA-compliant health insurance plan?

An ACA-compliant health plan refers to a medical plan that complies with the ACA’s provisions. For instance, these plans cover at least ten essential services outlined in the Affordable Care Act. Before you shop for ACA-compliant health plans, take time to understand these plans.

Pros of ACA-compliant health plans

Coverage of Pre-existing Conditions

Under the provisions of ObamaCare, insurance providers can’t charge beneficiaries with pre-existing conditions higher rates. These providers are also barred from denying coverage for essential health benefits and rejecting your claim. Additionally, your insurance provider can neither increase your premiums nor drop you if you fall sick after enrolling.

For those unfamiliar, these pre-existing conditions mentioned include cancer, asthma, pregnancy, depression, sleep apnea, and acne.


ACA’s subsidies translate to decreased out-of-pocket expenses for some people and $0 premiums for others, making health insurance affordable to many. Some of the subsidies given include cost-sharing reductions and tax credits.

Essential health benefits

Pre-ACA era, comprehensive medical coverage varied significantly, with some providers charging more or excluding certain services. Today, a provider must define essential health benefits qualified and abide by the ACA-mandated minimum coverage if they want to maintain status as an ACA- qualifying plan.

These services include emergency visits, substance use disorders, mental health treatment services, prescription medication, maternity care, and outpatient/ambulatory care. Other benefits include hospitalization, rehabilitative and habilitative services, laboratory services, pediatric services, and chronic disease management services.

Cons of ACA-compliant health plans

Despite its benefits, ACA has its disadvantages. For instance, these health insurance costs remain high, especially for people who don’t qualify for tax credits and subsidies. Additionally, the ACA’s provisions are responsible for eliminating about 250,000 small businesses that have tried to maneuver around the employer mandate.

In response to the Affordable Care Act, hospitality, food services, and retail companies also forced 500,000 workers into part-time employment. Because of these plans’ accompanying expenses, instead of making the customers’ existing non-compliant plans ACA compliant, insurance companies decided to cancel them, causing their clients to seek alternative coverage.

How do experts define a non-compliant plan?

These are plans that don’t adhere to ACA guidelines but still provide adequate coverage. These include indemnity plans, short-term health insurance, private health insurance, and faith-based plans.

Pros of ACA plan alternatives

Short-term health insurance

Short-term insurance coverage is available throughout the year, offering economical premiums and network-free options. With short-term plans at our ready aid, prospective beneficiaries can choose a plan that suits them best (30-364 days).

Private health insurance

Private health insurance rates are based on location, age, plan category, and tobacco use frequency. Generally speaking, their rates are lower than those state or federal-based insurance rates. As an additional benefit, potential beneficiaries can find these plans in all areas and still receive essential health services coverage.


You can purchase this coverage all year-round and even pair it with your existing coverage for added protection.

Faith-based plans

It is economical for families that cannot afford traditional plans. You can purchase them at any time from any state.

Cons of ACA plan alternatives

Short-term health insurance

Short-term health insurance features no guaranteed benefits and entails limited coverage. Unfortunately, it doesn’t offer coverage for pre-existing conditions, either. You might also fail to find it in some states.

Private health insurance

You can only obtain private health insurance during the open enrollment period, and it can cost a substantial amount of money per month when unsubsidized. These plans also include high deductibles.

Indemnity plans

An indemnity insurance plan does not cover pre-existing conditions and has limited coverage.

Faith-based plans

Faith-based plans are considered medical insurance and may not cover preventive care or pre-existing conditions. Additionally, these plans have limited coverage and don’t offer ACA subsidies.

In conclusion

The decision to choose between ACA compliant and non-compliant plans depends on your eligibility for various policies, healthcare needs, and how much you can pay in monthly premiums and out-of-pocket expenses. However, if you qualify for subsidies, ACA compliant policies are a better option.

If you have any questions, please ask below!