Medicare Watch

Supreme Court Finds Affordable Care Act Constitutional

In a 5-4 vote this morning, the Supreme Court upheld the constitutionality of the Affordable Care Act (ACA), including the individual mandate and the Medicaid expansion. However, by the Court’s ruling, the federal government will not be able to withhold states’ existing Medicaid funds, should they choose not to comply with the provision of the ACA that expands Medicaid to millions of low-income Americans.

The Supreme Court’s ruling is a great victory not only for advocates of the health care law, but also for the millions of Medicare beneficiaries who have benefited from the ACA since it was passed in 2010. The ACA has already saved Medicare beneficiaries more than $3.7 billion on prescription drugs, and 32.5 million people with Medicare accessed preventive services, including mammograms, prostate cancer screenings and the annual wellness visit, in 2011 alone. Additionally, thanks to the ACA, payments to Medicare Advantage plans are now better aligned with costs under Original Medicare. These improvements to the financial health of the Medicare program put Medicare in a stronger position to serve older adults and people with disabilities in the future.

Read Medicare Rights Center President Joe Baker’s statement on the Supreme Court’s decision.

Read the Supreme Court’s decision.

Read an analysis of the decision from the National Senior Citizens Law Center and the National Committee to Preserve Social Security and Medicare

Medicare Rights Releases New Report about Medicare Advantage Plan Landscape

Yesterday, the Medicare Rights Center released a report about the impact of measures in the Affordable Care Act (ACA) to reduce federal reimbursements to Medicare private health plans, also known as Medicare Advantage (MA) plans. These measures address overpayments to MA plans to make their costs more consistent with those under Original Medicare. Medicare Rights’ study was developed in response to predictions that ACA-mandated reductions in MA plan payments would cause insurers to leave the market, decrease plan benefits, and shift increased costs to Medicare beneficiaries. On the contrary, the report, which reviews a sample of MA plan offerings in New York in 2011 and 2012, found that Medicare beneficiaries enrolled in these plans did not experience significant changes in plan and benefit availability or affordability.

According to the report, in 2011 and 2012, the MA market remained relatively stable, despite the initiation of several changes for MA plans, including a maximum out-of-pocket threshold, limits on cost-sharing for certain services, and payment rate reductions. In fact, nationally, MA plan premiums have decreased, and plan enrollment has increased. While the number of plan offerings has lowered, the change was likely due to an initiative to eliminate duplicative plan choices from the same insurer. The report found that the plan landscape in New York followed the national trend.

In its more in-depth analysis of the New York market, Medicare Rights found that MA plans anticipate further reductions in plan reimbursements, as payment changes are phased in through 2019. Despite these reductions, the ACA financially rewards MA plans for increases in health care quality; the Centers for Medicare & Medicaid Services (CMS) distributes bonuses based on its five-star rating system for plans. Even with the prospect of these bonuses, the New York insurers were concerned about their ability to assume increased costs in the coming years. However, they also expressed a reluctance to change benefit packages, in part because CMS’ star ratings and the related bonus payments are tied to the breadth of a plan’s benefit offering. Instead, insurers indicated a need to first focus on other cost-saving tactics, such as promoting preventive care and driving down the costs of health care overall.

The report notes that in 2012, the MA plan landscape has remained as robust as and possibly more beneficiary-friendly than in years prior. However, Medicare Rights’ report advises government regulators and consumer advocates to continue monitoring MA plan benefits and cost structures in the coming years, as changes in reimbursements to private plans move forward.

Read Medicare Rights’ press release about the report, made possible by a grant from the United Hospital Fund.

Read the report, “New York’s Medicare Marketplace: Examining New York’s Medicare Advantage Plan Landscape in Light of Payment Reform.”

Medicare Reminder

You can have both Medicare and veterans (VA) benefits, but they do not work together. To receive VA benefits, you must receive care at a VA facility. Medicare does not pay for any care provided at a VA facility. You should enroll in Medicare Part A and Part B to guarantee coverage outside the VA system. If you drop Medicare, you will have to get all of your health care at VA facilities.

Many veterans use their VA health benefits to get coverage for services not covered by Medicare. For example, some veterans use VA services to obtain prescription drugs that are currently excluded from Medicare drug coverage, such as benzodiazepines and barbiturates, but rely on Medicare for their other prescriptions and medical care.

Since VA drug coverage is more comprehensive than Medicare’s, and there are no premiums and limited co-payments for prescriptions, you may not even want to enroll in a Medicare private drug plan. If you decide you want to enroll in Part D later, VA drug coverage is considered as good as the Medicare drug benefit (“creditable coverage”), so you will not have to pay a penalty, as long as you enroll in Part D within 63 days of losing VA benefits.

However, you may want to join a Medicare private drug plan if you live very far from a VA facility, and your Part D plan includes nearby pharmacies in its network, or if you live in a nursing home that does not accept your VA drug coverage.

Learn more about VA benefits at www.medicareinteractive.org, or call our helpline at 800-333-4114.

Spotlight

Families USA recently released a report about the consequences of not having health insurance, finding that in 2010 over 26,000 people died prematurely due to a lack of coverage. According to the report, uninsured adults are more likely to forego preventive services and be diagnosed with a disease in its advanced stage, in part because they find it more difficult to access primary care. Families USA also found that the number of uninsured adults has steadily increased since 2005. The Affordable Care Act may help to reverse this trend, as state exchanges offering affordable health insurance to individuals and small businesses are implemented, and insurance companies are prohibited from denying coverage or charging more to people with pre-existing conditions.

Read the report, “Dying for Coverage.”