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Life Health > Health Insurance

Seven ways health care reform will affect seniors

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The highly-debated and verbose health reform bill that passed late last month has several provisions that will affect your clients. U.S. News and World Report outlines some of the changes to Medicare you can expect and prepare your clients for.

  1. Prevention is priceless. As of Jan. 1, 2011, Medicare beneficiaries will no longer have to share the burden for preventative care. In addition to eliminating patient cost-sharing, the bill also adds a health-risk assessment and personalized prevention plan as part of an annual wellness exam.
  2. No more donuts. Medicare beneficiaries stuck in the donut hole will receive a $250 rebate for their prescriptions. In 2011, pharmaceutical manufacturers will begin providing a 50 percent discount on prescriptions. In 2013, federal subsidies will kick in, and the minimum amount a senior must spend out-of-pocket to qualify for catastrophic coverage will be reduced the following year (it’s currently $4,550). The donut hole is expected to be completely eliminated in 2020.
  3. Changes in premiums for wealthy seniors. Wealthy seniors who enrolled in Medicare Part B this year paid $154.70 each month, compared with most retirees’ $110.50, according to the magazine. Instead of increasing income thresholds each year, the bill will freeze them to allow more people to be covered over time. Premiums for Medicare Part D, on the other hand, are going up. The subsidy for seniors who make over $85,000 (or $170,000 for couples) will be decreased.
  4. Good news for boomers. Your younger clients will be able to take advantage of a temporary reinsurance program set up through employers. Employers will receive an 80 percent reimbursement for providing health coverage to early retirees and their families. This provision is only in effect until Jan. 1, 2014.
  5. The CLASS Act. Another provision aimed at boomers – or at least those clients who don’t plan on retiring immediately – the Community Living Assistance Services and Supports Act is a voluntary long-term care insurance programs that allows workers to contribute to an employer-sponsored long-term care insurance plan. After paying premiums for at least five years, participants will be eligible for at least $50 per day if they are unable to perform at least two activities of daily living. Premiums will be based on age, but not health conditions, and benefits can be paid to family caregivers.
  6. Medicare Advantage. Among the changes affecting Medicare Advantage plans, the magazine writes, they will be prohibited from charging more than traditional Medicare. Additionally, the plans will have to spend at least 85 percent of premiums on providing health care to policy holders as of 2014.
  7. Changing payment structure. The bill is taking a carrot-and-stick approach to changing the way doctors and hospitals are reimbursed for treating Medicare beneficiaries. In 2012, hospitals with “excess numbers of preventable patient readmissions” will be penalized, the magazine writes. In 2015, hospitals will receive 1 percent less in payments when patients contract a hospital-acquired condition. Rewards are available as well, though. U.S. News cites a provision that gives a 10 percent bonus to doctors who practice in areas with a shortage of health professionals.