Healthcare law – NJAAW – New Jersey Advocates for Aging Well

Medicare Advantage- Beware of scare tactics

What is Medicare Advantage? Medicare Advantage plans are private plans offered by insurance companies to replace your traditional Medicare benefits.

An advantage plan provides all the same benefits as traditional Medicare, such as doctor visits and hospital stays. Some plans may offer extra benefits that are not usually covered by Medicare, such as eyeglasses and hearing aids. Medicare Advantage plans come with a monthly premium that differs depending on the company and type of plan. The Federal Government pays the insurance companies to manage your care under a Medicare Advantage plan, instead of them managing it under traditional Medicare.

There have been some efforts to scare seniors into thinking that the Affordable Care Act (ACA) will change or effect their Medicare Advantage coverage. But you need to know the facts. The Affordable Care Act does not change any benefits guaranteed to Medicare recipients. This includes Medicare Advantage plans. What the ACA does change is the way the Medicare Advantage plans are paid. Starting in 2012, Medicare began reducing the extra government payments to insurance companies for Medicare Advantage plans. The reason for these plans have been made to reduce payments is because there is little evidence that better care was given to anyone on a Medicare Advantage plan. Medicare Advantage plans are eligible to receive bonuses if they provide quality care.

Enrollment in Medicare Advantage plans is low, even here in NJ, leaving some to question, what is the real advantage? Some may think having a commercial insurance company‚Äôs name on your card carries more weight than a Medicare card, but just like any commercial insurance plan, there are sometimes more hoops (referrals, prior authorizations) to jump through than there are with traditional Medicare.

What the Affordable Care Act does do for consumers who use Medicare Advantage plans is provide some protections. For example, Medicare Advantage plans are not allowed to charge more for services than traditional Medicare does. The ACA also has provisions to reduce out of pocket costs for patients using high-cost services like cancer treatment or dialysis. Under the ACA, Medicare Advantage plans have also been mandated to limit their administrative costs, as well as their profits. This measure is to ensure that the plans spend 85 % of their money on member benefits (that will start in 2014).

Rumors of Medicare Advantage consumers facing cuts to their benefits due to the ACA are rampant and intended to scare seniors. The truth is, every year the insurance companies are offered the choice to continue operating a Medicare Advantage Plan and to change the services offered under that plan (they are only required to cover what traditional Medicare covers). So, any year, not just this year, Medicare Advantage plans could chose to stop providing optional benefits such as eyeglasses.

So what does this all mean to you, the Medicare recipient? Well, if you are currently in a Medicare Advantage plan, your plan must send you a notice of any changes for 2013 by October 1, 2012. Make sure to read it carefully. Even if you are not currently in a Medicare Advantage plan, all Medicare recipients should go to www.medicare.gov to review both traditional Medicare and Medicare Advantage plans to compare and decide what is best for them. Open Enrollment is October 15 to December 7^thand during that period you can decide to stay in the same Medicare Advantage plan you have now, change to a different Medicare Advantage Plan or switch to traditional Medicare. If you chose to switch to traditional Medicare, remember that if you had a Medicare Advantage plan that offered prescription drug coverage you will need to also enroll in a Medicare drug coverage plan and/or buy a Medigap supplemental policy.

¬†Detailed information about Medicare, Medicare Advantage, Medicare Drug coverage, Medigap plans and Open Enrollment can be found at http://www.medicare.gov/.

¬†For detailed information about the Affordable Care Act and seniors, visit www.ncoa.org/StraightTalk

For more information about the Affordable Care Act in general, you can visit, http://www.healthcare.gov/law/index.html

Affordable Care Act (ACA) Facts: Follow this Series

There is a lot of speculation and discussion about what affect health care reform legislation, the Affordable Care Act (ACA), will have on seniors and more specifically, Medicare. We decided to do a series of blog posts about the facts; this is our second post, so please see Fact # 1 in a post dated, Feb 8, 2011.

Fact # 2 The ACA will reduce Medicare spending growth, extend Medicare solvency and is projected to reduce the budget deficit.

While Medicare spending will continue to grow, over the next 10 years the healthcare law will slow the overall rate of growth. Average spending per person will grow at about 2% per year, according to the Congressional Budget Office (CBO) this is compared to the current rate of 4% per person per year. This slight decrease will be a result of reductions in waste, fraud and abuse. ¬†The CBO also projects that the ACA will save Medicare about $400 billion over 10 years and will extend the solvency of the Medicare Trust Fund until 2026.

What you need to know:

In 2011, the ACA will slow payment increases that are made to Medicare providers such as, hospitals, nursing homes and home health agencies. Please note that doctors are not included in that group. The ACA does not reduce payments to your primary care doctor.

Also in 2011, payments to Medicare Advantage (MA) will be reduced. Approximately 25% of seniors are enrolled in MA plans, HMOs or PPOs offered by private insurance companies, the other 75% have traditional Medicare. The ACA will gradually lower payments made to MA plans, which on average cost 13% more than original Medicare. Another change that ACA makes to Medicare Advantage (MA) plans is that those plans will not be able to charge you more than what you would pay if you were on original Medicare for services such as kidney dialysis, chemotherapy, or skilled nursing home care.

Because of these laid out in the Law, MA plans may cut some of the extra benefits they offer that are not covered by traditional Medicare and some may increase their premiums. Please note that MA plans cannot cut any basic benefits under Medicare, such as doctor visits and hospital care. You will also have the same right to switch out of your MA plan to original Medicare, the new law will not affect your right to Medicare benefits.

Another way that Medicare savings will occur according to statements in the Affordable¬†Care¬†Act,¬†is for higher income individuals to pay higher prescription drug premiums. This will affect about 5% of Medicare recipients in 2011, single people with incomes above $85,000 and couples with adjusted gross incomes above $170,000.

The ACA states that in 2014 a Payment Advisory Board will be created. This board of experts will recommend specific ways to reduce Medicare costs without cutting benefits or increasing out-of-pocket costs.

Information in this blog was gathered from the Affordable Care Act,¬†¬†Congressional Budget Office, Centers for Medicaid and Medicare and the National Council on Aging.

For more information check out the following links:

A brochure from Medicare:

http://www.medicare.gov/Publications/Pubs/pdf/11467.pdf

Webpage from the National Association of States United for Aging and Disabilities (NASUAD):

http://www.nasuad.org/affordable_care_act/nasuad_materials.html

Answers from the National Association of Area Agencies on Aging (n4a):

http://www.n4a.org/advocacy/health-care-reform/

Straight Talk for Seniors from the National Council on Aging:

http://www.ncoa.org/public-policy/health-care-reform/straight-talk/

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