For people planning for lifelong health care and other long-term needs, coming to grips with the Patient Protection and Affordable Care Act is essential.
Edited by Bernard A. Krooks, J.D., CPA, LL.M
By now, you’ve probably heard plenty about the new health care law, sometimes referred to as “Obamacare” but officially known as the Patient Protection and Affordable Care Act. The law brings about significant changes both to Medicare and Medicaid.
The place to start is what hasn’t changed, and won’t change: Your Medicare benefits won’t be reduced or taken away in any way. Nor will your choice of primary care doctors be changed.
Medicare Preventive Services
The law introduces new benefits for Medicare plan participants. If you are on a Medicare Part B (medical insurance) plan, your “Welcome to Medicare” initial checkup is now completely covered provided that you get it done within the first 12 months of your Medicare membership. Other preventive procedures that are covered, without deductible or copayment, include:
- Abdominal aortic aneurysm screening
- Alcohol abuse screenings and counseling
- Bone mass measurements (bone density)
- Cardiovascular disease screenings (including cholesterol screenings)
- Cardiovascular disease (preventive behavioral therapy)
- Colorectal cancer screenings
- Depression screenings
- Diabetes screenings
- Diabetes self-management training
- Glaucoma tests
- HIV screenings
- Mammograms (screening)
- Nutrition therapy services
- Obesity screenings and counseling
- Pap tests and pelvic exams (screening)
- Prostate cancer screening
- Sexually transmitted infections screening and counseling
- Flu shots
- Hepatitis B shots
- Pneumococcal shots
- Tobacco quitting counseling
- Yearly “Wellness” visit
There are a few things to realize here. For one, while you’ll pay nothing for the services listed above, you may have to pay co-insurance (part of the cost) of the office visit when you get these services done. Also, the first yearly wellness checkup must come at least 12 months after your “Welcome to Medicare” checkup. And if you’re on a Medicare Advantage Plan, be sure to check with your plan to see if these benefits are also free to you.
Medicare Advantage Plans
The law changes how the government subsidizes Medicare Advantage plans, rewarding those that provide high-quality care but cutting subsidies to the plans to bring them more in line with Traditional Medicare.
Medicare Advantage plans that are rated three out of five stars or better will receive bonus payments. The plans must use at least some of this bonus money to provide extra benefits and rebates to plan participants.
In order to save money, Medicare began reducing subsidies to Medicare Advantage plans in 2012. Some of this money saved is being used to close the donut hole in Medicare prescription drug coverage.
Medicare Drug Benefits
As you may know, there is a coverage gap in the Medicare Part D drug ben- efits sometimes called the “donut hole.” This refers to the gap between where Medicare Part D benefits end and where Medicare’s “catastrophic” coverage begins. While in this gap, Medicare participants are responsible for the entire cost of their prescription drugs.
The new health care law will close the donut hole significantly by 2020, and in the meantime, it offers a 50 percent discount on covered brand-name drugs. And in the intervening years, the benefits will gradually improve:
- 2012: You pay 50% for brand-name drugs and 86% for generic drugs
- 2013: 47.5% for brand-names and 79% for generics
- 2014: 47.5% for brand-names and 72% for generics
- 2015: 45% for brand-names and 65% for generics
- 2016: 45% for brand-names and 58% for generics
- 2017: 40% for brand-names and 51% for generics
- 2018: 35% for brand-names and 4% for generics
- 2019: 30% for brand-names and 7% for generics
- 2020: 25% for brand-names and 5% for generics
There are rules affecting who can get the extra savings, however. To qualify, you must be enrolled in a Medicare Prescription Drug Plan or a Medicare Advantage Plan that covers prescription drugs. You cannot receive assistance from Medicare’s Extra Help program, which helps people of limited means afford prescription drugs. And, of course, you must have reached the donut hole in your drug coverage. Keep in mind that while you pay only 0 percent of the cost of a brand-name drug, the entire cost counts toward the level at which your catastrophic coverage kicks in.
For people who don’t qualify for Medicare, the law introduces a new requirement that protects those with pre-existing conditions from being denied insurance. This provision, called the Pre-existing Condition Insurance Plan, is currently available in every state. To qualify, you must be uninsured for six months and denied coverage because of your health.
Likewise, insurance companies can no longer drop you if you get sick, so long as the premiums are paid and up-to-date. And lifetime limits on benefits are now banned, with a ban on annual limits going into effect in 2014.
One of the law’s innovations is the creation of health insurance exchanges, which will be state-run marketplaces where you can compare health insurance plans side-by-side. Enrollment in every state begins in 2013, and the exchanges become active in 2014. All plans sold in health insurance exchanges must cover certain essential health benefits, such as hospitalization, medical care, mental health services, prescription drugs and rehabilitative services.
As you may know, neither Medicare nor most private health insurance plans pay for long-term care. Medicaid provides for most long-term care, but you must qualify, and qualifications vary by state. The new health care law will make Medicaid more broadly available beginning in 2014 in every state that chooses to participate. The Supreme Court held unconstitutional the provision of Obamacare that required all states to participate.
For families with loved ones in elder-care facilities, such as nursing homes, the new law provides that more thorough in- formation about such facilities be made available to the public. This information includes ownership of the facility, how much the home spends on resident care versus administrative expenses, how many hours of nursing care residents receive, how much turnover there is in staffing, and the number of complaints and violations. The states will be required to post this information on a website.
Careful planning is essential for pre-paring for long-term care needs, and the services of an elder-law attorney are ideal for getting the help you need to prepare. You can find an elder-law attorney in your area through the searchable directory at the National Elder Law Foundation’s website (www.nelf.org).
Bernard A. Krooks is managing partner of the law firm Littman Krooks LLP (www.littmankrooks.com). A certified elder law attorney, he is a past president of the National Academy of Elder Law Attorneys and past president of the Special Needs Alliance.