Since we’re in the silly season of a national election there will be a welter of claims made on behalf of candidates for public office that are intended to confuse, obscure and bend the truth. You may expect that some of those claims will relate to the impact of the Affordable Care Act (ACA, sometimes called Obamacare, Obamneycare or Romneycare) on Medicare. While the implementation of many elements of the ACA won’t happen until 2013 and 2014, some are already in effect and they do have an impact on Medicare. Here’s how:
Reduced Costs for Prescription Drugs. Because of ACA, people with Medicare already pay less for their drugs during the "Donut Hole." Beneficiaries used to pay full price in the Donut Hole but now pay only 50% of the cost of brand name drugs and 86% of the cost of generic drugs. The ACA will eliminate the Donut Hole by 2020.
Improved Accountability for Private-Market Medicare Advantage (MA) Payments. Under the law, MA payments were restructured to match payments in traditional Medicare. Prior to the restructuring, MA payments were, on average, 13% higher than those for traditional Medicare. Also, MA plans are now prohibited from charging higher cost-sharing than traditional Medicare for skilled nursing facility care, chemotherapy and kidney dialysis. Further, starting in 2014, MA plans will be required to spend a specific percentage of premiums on actual coverage rather than on administration, marketing or profits (MA overhead is @14% while the overhead for Government-based Medicare is @ 4%).
Preventive Health Services for Medicare Recipients. ACA added coverage for preventive care and made most preventive screenings and services free for people with Medicare – that means no deductibles or co-pays. ACA also added an annual Wellness Visit, all at no cost to the beneficiary.