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Enactment of the new
health-care reform legislation contains some
provisions that directly affect our nation’s older
population. If you are a senior, you may be
concerned about how these reforms may affect your
access to health care and the benefits you are
currently receiving.
Medicare spending
cuts
Not surprisingly,
the concerns of retirees and seniors generally
center on potential cuts in Medicare benefits.
At the outset, the new legislation does not affect
Medicare's guaranteed benefits. However, a
goal of the new health-care legislation is to slow
the increasing cost of Medicare premiums paid by
beneficiaries, and to ensure that Medicare will
not run out of funds. To help achieve these goals,
cuts in Medicare spending will occur over a
ten-year period, beginning in 2011, particularly
targeting Medicare Advantage programs––Medicare
programs provided through private insurers but
subsidized by the federal government. These
cuts could reduce or eliminate some of the extra
benefits Medicare Advantage plans may offer, such
as dental or vision care, and some insurers may
choose to increase premiums. But Medicare
Advantage plans cannot reduce primary Medicare
benefits, nor can they impose deductibles and
co-payments that are greater than what is allowed
under the traditional Medicare program for
comparable benefits. And, some of the federal
funds previously earmarked for Medicare will be
reallocated to doctors and surgeons as an
incentive to treat Medicare patients.
Medicare Part D
drug program changes
Some Medicare Part D
beneficiaries are surprised to find that they have
to pay for the entire cost of prescription drugs
out-of-pocket after reaching a gap in their annual
coverage, referred to as the "donut hole."
Currently, if you're a Medicare Part D
beneficiary, you may pay up to an additional
$3,610, out-of-pocket, for medicines after
reaching an initial threshold of $2,830 in total
prescription drug costs (including Part D payments
beneficiary co-pays, and deductibles.) But,
beginning in 2010, beneficiaries who fall in the
donut hole will receive a $250 rebate, and, in
2011, they will receive a 50% discount on
brand-name drugs. By 2020, a combination of
federal subsidies and a reduction in co-payments
will completely eliminate the donut hole.
However, individuals with annual incomes greater
than $85,000, and couples with incomes exceeding
$170,000, will see their Part D premiums increase
as the federal subsidy offsetting some of the cost
of Medicare Part D premiums is reduced.
Benefits added to
Medicare
The legislation also
improves some traditional Medicare benefits. For
example, Medicare beneficiaries will receive free
wellness and preventive care beginning in 2011.
Increased access to home-based care
Often, people with
disabilities or illnesses would rather receive
care at home instead of at a hospital or nursing
home. The new health-care reform law
provides for programs and incentives for greater
access to in-home care. The Community Living
Assistance Services and Support program (CLASS)
will be established sometime after 2011 (depending
on when final regulations are published) as a
voluntary insurance program, financed through
payroll deductions and available to all working
adults who choose to participate. This
national program allows participants with
functional limitations to maintain their personal
and financial independence and live in the
community by providing a cash benefit of at least
$50 per day (after a five-year vesting period) for
nonmedical services, such as home-care services,
family caregiver support, and adult day-care or
residential-care services. In order to
qualify, a participant must need help with at
least two activities of daily living, such as
eating, toileting, transferring, bathing,
dressing, or continence.
Also in 2011, the
Community First Choice Option will be available to
states to add to their Medicaid programs.
This option will provide benefits to
Medicaid-eligible individuals for community-based
care instead of placement in a nursing home.
In addition, the State Balancing Incentive
Program, to be established in 2011, will provide
increased federal funds to qualifying states that
offer Medicaid benefits to disabled individuals
seeking long-term care services at home, or in the
community, instead of in a nursing home. The
Independence at Home demonstration program,
available in 2012, will be a test program that
provides Medicare beneficiaries with chronic
conditions the opportunity to receive primary care
services at home. That is intended to reduce
costs associated with emergency room visits and
hospital readmissions, and generally improve the
efficiency of care. |
