Obamacare and Sequestration

Obamacare and Sequestration appear several times daily in the media and news reports, along with information specific to Medicare, Medicaid, and Social Security.  And every day each writer seems to have a different opinion or information on the topic.  Here is what I have found available today.  Please take a minute to review, as there are some new websites which could be of value to you.

Obamacare

Also officially known as the Affordable Care Act, I read this morning that this is the third anniversary of the passing of this landmark legislation, commonly known as Obamacare..  I know I’m confused by exactly what this law means to me and my family personally. I assume you have lots of questions as well.

According to Nick J. Tate (ObamaCare Survival Guide, www.humanixbooks.com, 2012) this law has never been popular with the American people, the majority of whom want it repealed.  The Supreme Court voted on the individual mandate of the law, the contraception mandate is under discussion, the CLASS (Community Living Assistance and Supports) component was “suspended” in October, 2011 by the White House. (This provided a long term component to the law).

It is ironic to me that the “Affordable Care Act” seems to be resulting in higher premiums already for many. And, if you are receiving your health insurance benefits through your employer, you are probably paying a greater percentage of the premiums than ever before. The average family health insurance premium now exceed $15,000 on average per year. (Kaiser Family Foundation).

The next consideration will be whether businesses, particularly those employing fewer than 50 individuals, will continue to provide health insurance. The definitions of those eligible for coverage are changing (30 hours per week of employment compared to the current 40 hours per week), the health care exchanges will give individuals additional choices, and in some cases the employer will pay less with the imposed penalties than they would to provide health insurance.  Very confusing and stressful situation for all involved.

Medicare

The primary change to Medicare which occurred beginning in January, 2013 is to make the “donut hole” smaller for the Medicare D, prescription drug component of the program.  It will continue to decrease in size in the next few years, if there are no changes to the plan with the ongoing discussions regarding sequestration and the Affordable Care Act.

There has also been a $5 increase in the monthly Part B premium.  The Part A and B deductibles have also increased: Part B on a sliding scale based upon income.  The average out of pocket expenditure for Medicare recipients is now $4,500 per year, according to the Medicare Rights Center (www.aarp.org/bulletin January-February 2013)

In my discussions with Medicare recipients, there is a lot of confusion of just what their benefits are, in particular with the Medicare D drug component.  I can only suggest that you take the time to check your specific policy.  If you are covered through a corporate program as a retiree, check the company’s website.  Or, check www.Medicare.gov, enter your Medicare number and you will be guided through the process of finding your specific information. If you need assistance, consider contacting a patient advocate or case manager for personalized assistance in finding answers to your questions.

There also have been no decreases, yet, in reimbursement to Medicare providers (doctors).  While the Affordable Care Act made sure to let the participants of the program know that their payments were being carefully monitored, it was not as well advertised that there are major changes and deductions in reimbursement for providers in the program.  At the moment the reductions to physicians has been placed on hold, once again.  My readings indicate that many physicians are re-thinking their participation, some not accepting new Medicare patients, some not accepting any Medicare patients at all into their practices.  If you live in an area where there are choices in your health care, this is not necessarily a problem at present.  If, however, you live in an area where you have limited choice unless you wish to travel great distances, this could be a major problem.

I will write further about the discussion on doctors and trends in another posting.

Medicaid

Beginning January, 2014 there will be a major expansion of this program under the Affordable Care Act.  The eligibility levels will be raised, so that an individual earning approximately $15,400 annually, would now qualify for Medicaid benefits.  While paid in full by the federal government for the first three years, this applies only to those newly eligible, not those who qualified under the old income levels and were not active participants.  Secondly, every state appears to manage their Medicaid programs somewhat differently, and the number of eligible participants varies greatly.  There appears to be some question of what will happen regarding the funding for the “new” participants enrolled in 2014 beginning in 2017; the end of the three year federal funding agreement. The federal government is supposed to reduce their payments to 90%, leaving the states with the additional 10% to maintain their participation in the program. Many states are currently in financial crisis and don’t want to willingly incur more debt.

There is also discussion about whether those who are eligible will actually choose to enroll in this new program. In order for the program to be successful as it has been envisioned, a large proportion of those eligible to enroll need to do so.  But how and where are they going to get the necessary information about the program, how to enroll, etc.?

It is important to remember that Medicaid is currently the primary payor for 2/3 of nursing home residents, in addition to providing home health services to many. (www.AARP.org/bulletin, January-February, 2013).

Social Security

Those currently covered by Social Security don’t want changes.  Those who are soon to retire and have anticipated being able to receive the benefits for which they have been paying for their working life don’t want change.  Those who are far from retirement age aren’t too happy to be supporting a program which probably won’t benefit them as it is currently configured.

I recommend you read this article from the Wall Street Journal to get a better idea of the financial challenges we face with both the Social Security and Medicare programs.

http://online.wsj.com/article/SB10001424127887323869604578368481493685730.html?mod=wsj_valettop_email

Sequestration

The budget debate continues and the program cuts and curtailments have begun.  Health care will certainly be impacted.  It is one fifth of our national economy.  Since there is no specific end to sequestration right now, businesses are challenged in their decision making.  In the short run jobs will be lost or hiring freezes will continue, programs will be reduced or eliminated, it will take longer to receive services than we have previously experienced.

I hope there is a serious attempt to reach an agreement and end sequestration after Congress returns from its break next week. You can’t run your household or your business in this manner.  You certainly shouldn’t expect a government to run this way. The world and the American people are watching and waiting.

Other Considerations

Obamacare, except for the CLASS component which has been shelved, did not include any considerations for long term care.  While gender-based pricing is banned in the new law, long term care insurance considerations are not part of Obamacare, resulting in higher premiums for women enrolled in long term care policies.  (Chicago Tribune, March 13, 2013, “Women’s long-term care insurance fees rising”)  The increase is being justified by the longer life span predicted for women compared to men.

Obamacare and Sequestration, Medicare, Medicaid, Social Security: important to learn as much as possible about all of them but  time-consuming and confusing.  If you have resources and ideas you would like to share on this topic, please contact me so that we can continue the dialog and we can all learn more about these critical programs which impact us all.

 

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