There's been so much misinformation about the new health reform law, it's hard NOT to be confused. But the National Partnership's health policy team wants you to have answers to questions you submitted when President Obama signed the new law.
Health reform offers the promise of making health care more affordable, more accessible, more efficient, more centered on patients, and more fair for those who for too long suffered discrimination in insurance and disparities in care.
See below for answers to some of the most frequently asked questions. And watch this space for more answers in the weeks ahead, and join the Campaign for Better Care to ensure that health reform implementation works for all of us!
Q: How will the new law affect Medicare benefits?
The new law does not cut basic guaranteed benefits for Medicare beneficiaries. Experts expect it to achieve some savings in Medicare through improvements in the effectiveness and efficiency of the program, and prevention of fraud.
The new law includes a number of important improvements to the Medicare program:
Prescription Drugs: Under current law, Medicare covers your drug costs up to an initial threshold ($2,830 in 2010). Once you reach that threshold, Medicare stops paying. This is known as the coverage gap or "doughnut hole." Beneficiaries in the coverage gap are responsible for 100 percent of their drug costs. Once you reach a second threshold, Medicare's coverage begins again and covers 95 percent of your costs. Beginning July 1 of this year most Medicare beneficiaries enrolled in a Part D drug plan who wind up in the coverage gap will receive a one time rebate of $250.
Beginning January 1, 2011, the coverage gap will begin to close so that by 2020, beneficiaries will only be responsible for 25 percent of their prescription drug costs. The legislation also adjusts the indexing of the out-of-pocket threshold (i.e., the point where enrollees enter catastrophic coverage) between 2014 and 2019 to help slow its growth. Note: Part D enrollees who receive the low-income subsidy are not eligible for the $250 rebate or discounts in the doughnut hole because these costs are already covered by the federal government.
Prevention: Starting next year, you will no longer pay any cost-sharing for Medicare preventive services (like screenings for colon, prostate and breast cancer), for Medicare's annual wellness exam, or for immunizations. Medicare will also cover development of a personalized prevention plan.
Q. How will the new reform law change Medicare Advantage (MA)? Will it affect benefits and premiums/cost-sharing for those in MA plans?
Right now Medicare pays more for the care provided by private Medicare Advantage (MA) plans than it does for traditional Medicare - but there isn't strong evidence to show that MA plans are providing beneficiaries or Medicare more value for the dollar. The new law levels the playing field by bringing MA payments down to the same level as traditional fee-for-service Medicare.
Not only does this make the program fairer for all beneficiaries, but the savings generated will help to extend the life of the Medicare Trust Fund.
The new law does not cut the basic guaranteed Medicare benefits provided to MA beneficiaries.
But because payments to MA plans will be reduced, the plans may change the optional benefits they offer (which may include "extras" like coverage of eyeglasses or gym memberships).
Q. I understand that the present system of payment for Medicare - that is, fee for service - encourages doctors to practice defensive medicine, recommending services that may not really be needed. Will this change under the new law?
Right now, our health care system pays providers based on the number of services provided, rather than whether they are providing high quality, coordinated care that meets patients' needs. The new health reform law promotes innovation in Medicare payment and delivery that will help reorient our system to provide the right care, in the right amount, at the right time, and encourages providers to work together to coordinate care.
We know that good primary care is critically important to good patient health outcomes - particularly for the most high-risk, vulnerable patients. Beginning in 2011, the law provides 10 percent Medicare bonus payments (for five years) to primary care practitioners as well as general surgeons practicing in areas with shortages of health professionals.
The new law promotes innovative delivery and payment models which will create incentives for teams of health care professionals to provide better coordinated, higher quality primary care that is built around the needs of the patient - rather than simply reimbursing providers for individual services.
The new Center for Medicare and Medicaid Innovation within the Centers for Medicare & Medicaid Services will test, evaluate and rapidly expand different Medicare payment models once they are shown to foster more patient-centered care and better care coordination, as well as slow cost growth.
Q. Will younger people now be able to opt into Medicare?
The new law does not change the eligibility rules for Medicare. Medicare remains an option only for people 65 and older, as well as those who qualify for Social Security disability. But there may be other options for obtaining health insurance.
For individuals who have an income at or below 133 percent of the federal poverty level, Medicaid eligibility could open up on a state-by-state basis until it is mandated in 2014.
Small businesses that employ 25 or fewer employees with an average salary of $50,000 or below will receive sliding scale tax credits for providing health benefits to its employees starting this year.
In 2014 and afterward, individuals will be able to purchase health insurance through new Exchanges.
Prior to the initiation of these Exchanges, individuals who have had no health insurance for at least six months and who have a preexisting condition can qualify for a temporary insurance program that offers coverage, rate limits, and assistance with transition to the Exchange.
Q. How does the law affect supplemental health insurance plans?
The new law does not change supplemental health insurance plans (also known as "Medigap" insurance).