How Health Reform Affects Medicare

The Affordable Care Act has changed your Medicare coverage.

You Can Get More Care at No Additional Cost

Many types of preventive care are now available to you at no additional cost. Preventive care can help you stay well and avoid diseases.

With any type of Medicare coverage, you can have a wellness exam every year without having to pay anything at the time of your visit. You and your doctor will map out a plan to keep you healthy.

You can get most screening services without additional cost. Screenings are medical tests to find illnesses early, when they're easier to treat. For instance, a mammogram is a screening for breast cancer. A colonoscopy checks for colon cancer. You can also be checked for diabetes, high blood pressure, and high cholesterol.

You can get help to kick the habit. If you're a smoker, you can get counseling to help you quit.

 

You'll Save Money on Medicine

The donut hole is a gap in your drug coverage under Medicare Part D. That hole is shrinking. Here's how it works:

Each Part D plan covers up to $3,310 for medicines in 2016 and $3,700 in 2017. That amount includes what you pay and what your insurance pays. Once you reach that limit, your prescription benefits go down. That's when you're in the gap -- the donut hole.

For the time you're in the donut hole, in 2017 your copay for medicines is 40% for brand-name prescriptions and 51% for generics. You pay this percentage on your medicines until you have spent $4,850 for 2016 and $4,950 in 2017.

Each year from now until 2020, the percentage you pay while in the donut hole will shrink -- by 2020, you'll pay no more than 25% for all prescriptions.

Something to Watch: Medicare Advantage Plans

If you have a Medicare Advantage plan, which is also known as Medicare Part C, from a private company, your coverage may change from year to year. Unlike traditional Medicare, if you are in a Medicare Advantage plan you must get your care from a network provider.

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The Affordable Care Act says that your insurance company will get a bonus if they improve your Part C plan, and many have succeeded in doing so.

However, many Medicare Advantage plans are also reducing the size of their provider and pharmacy networks. Or they may increase what you pay in copays or coinsurance. That’s why it’s important to shop for plans each year during the Open Enrollment Period from October 15  to December 7 each year. Given ongoing changes to plan details, it’s a good idea to make sure the coverage you have continues to be the best for you.

Have a High-Income? You'll Pay Higher Premiums

If your income in 2016 is less than $85,000 ($170,000 for a couple), you pay $121.80 a month for Medicare Part B. For Medicare Part D drug coverage you will pay whatever the base premium is for the plan you choose. This will be the case for 95% of everyone who uses Medicare.

People with higher incomes will pay more for coverage.

For instance, if you earn $85,000 to $107,000 a year ($170,000 to $214,000 for a couple), you pay $170.50 for your Part B coverage (in 2016). In this income range, you’ll also pay an additional $12.70 above the cost of your plan’s premium for Part D each month. If you earn more, you'll pay more.

WebMD Medical Reference Reviewed by Sarah Goodell on September 08, 2016

Sources

SOURCES:

U.S. Department of Health and Human Services: "Seniors and the Affordable Care Act;" "Medicare Preventive Services;" "Medicare Beneficiary Savings and the Affordable Care Act;" "Strengthening Medicare;" "Medicare Drug Discounts;" and "Better Health, Better Care, Lower Costs: Reforming Health Care Delivery."

Centers for Medicare & Medicaid Services: "Your Medicare Coverage-Preventive & Screening Services;" "The Affordable Care Act & Medicare;" and "Medicare Advantage Plans."

AARP: "Doughnut Hole Calculator."

Center for Medicare Rights: "The Affordable Care Act: Closing the Doughnut Hole."

Kaiser Family Foundation: "Explaining Health Care Reform: Key Changes to the Medicare Part D Drug Benefit Coverage Gap" and "What Happens to Medicare Advantage Plans."

Social Security: "Medicare Premiums: Rules for Higher Income Beneficiaries." 

Medicare.gov: “More Savings in the Drug Coverage Gap Coming Through 2020” and "Medicare Premiums: Rules For Higher-Income Beneficiaries."

Health Affairs, Oct. 11, 2012: "Pay-for-Performance."

Marc Steinberg, deputy director of health policy, Families USA.

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