For Seniors

Health reform will bring a number of improvements and additional benefits for consumers - but at a cost. These changes looks different for every consumer. Rates will be higher, but some customers will pay less than they do now. Some will pay more. Find out more about health care reform and how you can get the most benefit from the law.

What does health care reform mean for seniors?

Part D

Medicare Part D (the part of Medicare that covers prescription drugs) has famously had a coverage gap, or "doughnut hole,"" since it was established in 2003.

The coverage gap was when a beneficiary reached $2,830 in drug expenses and persists until $4,550, leaving many exposed to the high costs of needed medicine.

The Affordable Care Act took steps to close this gap by:

  • Issuing $250 rebate checks in 2010.
  • Planning for gradually reducing the coverage gap through discounts.
  • Creating a new, quicker process to make beneficiaries eligible for catastrophic coverage.

In the Spotlight

Health Care Reform and Medicare Part D

Medicare Advantage

Medicare Advantage (or Part C) coverage is a way of providing Medicare through a private insurer, usually covering more services than traditional Medicare Parts A and B.

The Affordable Care Act makes sweeping changes to reimbursement to Medicare Advantage plans, lowering reimbursement overall but providing bonuses for reaching certain quality ratings.

The health care reform law requires some preventive services, including an annual wellness exam, to be covered at no cost to the Medicare Advantage enrollee. BCBSNC provided no-cost wellness exams before the law was in effect.

In the Spotlight

Health Care Reform and Medicare Advantage

Prevention

The Affordable Care Act does a lot to boost access to preventive services and encourage consumers to use them. Health care reform also requires that many preventive services be provided at no cost to the consumer, such as colonoscopies and contraceptive services.

In the Spotlight

Health Care Reform and Prevention

Pharmaceuticals

Pharmaceutical companies account for a growing portion of health care spending. Like all health sectors, the pharmaceutical industry is impacted by the Affordable Care Act.

Beginning in 2011, pharmaceutical companies that make brand name drugs will pay an annual assessment to help fund a portion of the health law (in 2012 and 2013 the aggregate fee was $2.8 billion).

In the Spotlight

The Pharmaceutical Industry

Medigap

Medigap coverage offers Medicare beneficiaries protection from the high out-of-pocket cost-sharing responsibilities for enrollees of Medicare Part A (hospital insurance) and Part B (medical insurance).

These plans typically cover people in rural areas without access to Medicare Advantage plans, no access to employer-sponsored retirement plans, and incomes too high for Medicaid to supplement Medicare. About 19% of North Carolina residents have this supplemental coverage.

The Affordable Care Act requires the National Association of Insurance Commissioners (NAIC) to review the two Medigap policies with first-dollar coverage for potential revision to include "nominal cost-sharing to encourage the use of appropriate physician services under (Medicare) Part B." The new benefit standards are to be made available beginning January 1, 2015.

In the Spotlight

Medicare Supplement

Premium Impacts

Premiums will increase for three reasons:

  • Adverse selection. The Affordable Care Act (ACA) limits how much premiums can vary based on a person's age or health condition, which means younger and/or healthier people will subsidize coverage for older individuals. This increases the likelihood that younger, healthier people may choose to pay the relatively low penalty and wait to purchase health insurance until after they get sick or injured, thus driving up costs for everyone else.
  • New taxes imposed by the ACA. The variety of new taxes ($8 billion in 2014, increasing to $14.3 billion in 2018) will be passed to the consumer through premium increases.
  • Additional benefits required by the ACA. Starting in 2014, all health insurance policies will be required to include new mandated benefits. This means millions of people will be required to purchase health insurance plans that are more comprehensive, and more expensive, than they currently have.
Taxes and Fees

The Affordable Care Act (ACA) expands coverage dramatically with a combination of the individual mandate, federal subsidies to make insurance more affordable for low- and middle-income people, and the potential expansion of state Medicaid programs.

Most people agree that expanding health insurance coverage to millions more people in the United States is a good thing, but who picks up the tab?

There are many new taxes and fees included in the law designed to finance the coverage expansion and other new or reformed programs. These taxes include several on the insurance industry, medical device community, pharmaceuticals, some employers, and a specific fee for using the Exchange.

While paying for reform is important, new fees could result in more expensive premiums.

In the Spotlight

ACA Taxes and Fees