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The Affordable Care Act: How it Will Impact Seniors

Alison Stanton | Oct 3, 2013, 2:06 p.m.

Just like Traditional Medicare, participants in Medicare Advantage plans are still required to pay the Medicare Part B (outpatient coverage) premium, which is approximately $110 per month for most Medicare participants.

Medicare Part D - Prescription Drug Coverage

Perikly says the ACA will bring some changes to the prescription drug deductible and to what is commonly called the “donut hole”—the gap between the initial prescription drug coverage limit and when prescription drug spending is high enough that coverage begins again.

“Medicare beneficiaries who have higher spending for prescription drugs may spend less in 2014. Beneficiaries will enter the donut hole sooner, but will leave the donut hole faster and will have a larger discount while in the donut hole,” Perikly says, adding that this will be 28 percent in 2014 versus 21 percent in 2013.

In addition, Weissman says the donut hole will be gradually phased out through discounts on prescription drugs until closed in 2020. 

“Most indications are that this aspect of the ACA has been received favorably,” he notes.  

Overall, Leafman says, one of the ACA’s major initiatives is the reduction in out-of-pocket costs for prescription medications.

“Initially, those who have exhausted their first tier of Part D benefits and have entered the ‘donut hole’ will receive discounts averaging 50 percent on their medications until they have completed their tier two coverage under Medicare Part D,” he says, adding that the discount percentages will be phased in over time, starting at only 21 percent on generic medications in 2013. “The covered percentage of costs for brand name drugs is higher and by 2014 it will reach 52.5 percent for brand name drugs and 28 percent for generics.”

Just like Medicare supplemental plans, Medicare prescription plan competition is also heating up, Leafman notes. “The unprecedented number of Baby Boomers aging into Medicare has created a growing market in opportunity for insurance companies. Consumers are encouraged to shop their Part D coverage during open enrollment each year in order to monitor their total cost of prescription medication,” he says, adding that personalized comparisons of plans, based on each individual’s medications are available at: www.medicare.gov or through most pharmacies.

Medicaid

Arizona is one of 26 states that have chosen to move forward with Medicaid expansion. This expansion will bring new federal funds to Arizonans, Leafman adds, many of whose lives will be greatly improved by easier access to medical care. “There are nearly 600,000 nonelderly individuals in Arizona who currently, or will very shortly qualify for Medicaid, double the number of currently covered individuals. Putting this into perspective, 23 percent of Arizona’s population is uninsured.”

The federal law sought to extend Medicaid to all people who earn less than 138 percent of the federal poverty level, which equates to just under $16,000 for an individual and $32,500 for a family of four based on current guidelines.

This expansion, plus premium subsidies through the public marketplace for those whose household incomes are less than 400 percent of the federal poverty level, Leafman adds, will greatly enhance the availability and affordability of health care for hundreds of thousands of Arizona residents. “It is important to note that the federal government will fund 100 percent of the Medicaid expansion for the first three years of the program,” he says, noting that federal funding will then gradually decrease to the ultimate level of 90 percent by the year 2022.

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