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How the Affordable Care Act Affects Medicare Beneficiaries

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Summary: The Affordable Care Act helps lower prescription drug costs for Medicare beneficiaries & helps expand Medicare preventive benefits.

The Affordable Care Act (commonly called “Obamacare”) requires that all Americans have health insurance that meets minimum essential coverage standards, such as through an employer, veterans benefits, or other source. If you’re already enrolled in Original Medicare (Part A and Part B) or in Medicare Advantage (also called Medicare Part C), you meet the law’s coverage requirements. You also don’t need to take any action if you’re enrolled in just Medicare Part A.

Medicare generally costs you less than Obamacare

The federal government pays for most Medicare costs. Affordable Care Act (ACA) plans are usually offered by private health insurance companies. So, Medicare generally costs you less. Take a look at this graph of different kinds of plan premiums from 2017 and 2018.*

ACA Premiums vs. Medicare Premiums

Source: Premiums and Out-of-Pocket Costs Before and After Medicare

It used to be that if you were only enrolled in Medicare Part B, you might have to pay a tax penalty. Having only Medicare Part B doesn’t meet the minimum essential coverage requirements. However, tThe penalty expired as of 2019, according to CNBC.

Even if you’re only enrolled in Medicare Part B, you shouldn’t sign up for a Marketplace plan if you already have Medicare coverage. In fact, the government tries to prevent the sale of Marketplace plans to anyone who is a Medicare beneficiary.

Most people don’t pay a Medicare Part A premium, but some people do. If you need to pay a premium for Medicare Part A, make sure you enroll when you were first eligible. If you don’t, you may have to pay a separate late-enrollment penalty for Part A when you do sign up.

How Obamacare affects Medicare coverage

Obamacare expands Medicare coverage in a few important ways:

Costs in the Medicare Part D coverage gap

The Medicare Part D coverage gap is the temporary limit on what your Medicare Part D Prescription Drug Plan pays for prescription drugs. Beneficiaries enter the coverage gap once they and their plans have spent a certain combined amount on covered prescription drugs. While beneficiaries were previously responsible for 100% of prescription drug costs in the coverage gap, the Affordable Care Act reduces these costs through manufacturer discounts and government subsidies. Beneficiaries who enter the coverage gap will be responsible for a smaller portion of covered prescription drug costs every year until the coverage gap, also known as the donut hole, is closed in 2020.

Medicare preventive services

Certain Medicare Part B services may now be completely covered for Medicare beneficiaries; this includes, but isn’t limited to:

  • Abdominal aortic aneurysm screenings
  • Alcohol misuse screenings and counseling
  • Cardiovascular disease screenings
  • Cervical and vaginal cancer screenings
  • Certain colorectal cancer screenings
  • HIV screenings
  • Depression screenings
  • Diabetes type 2 screenings
  • Nutrition counseling services
  • Obesity screenings and counseling
  • Certain vaccines, such as the flu shot, pneumococcal shot, and hepatitis B shot
  • Sexually transmitted infections screenings and counseling
  • One-time ‘Welcome to Medicare’ preventive visit
  • Annual ‘Wellness’ visits

Confirm the details of coverage with your Medicare plan and your doctor or health-care provider. Some benefits may have additional eligibility requirements to be covered by Medicare. Make sure your doctor or health-care provider accepts Medicare assignment, or the benefit may not be fully covered.

Obamacare’s expanded Medicare preventive coverage applies to all Medicare beneficiaries, whether they have Original Medicare or a Medicare Advantage plan. However, if you’re interested in broader health coverage, many Medicare Advantage plans cover benefits beyond Original Medicare, such as routine vision and dental benefits, wellness programs, or prescription drug coverage.

NOTE: As of the writing of this article, there are various proposals for Congress to repeal or replace Obamacare, so the situation may change.

For more information

Healthcare.gov, “Medicare and the Marketplace” [https://www.healthcare.gov/medicare/medicare-and-the-marketplace/]

*ACA costs are based on plan selections from November 1, 2017 to June 30,

2018; Medicare costs are based on plan selections from October 15, 2017 to June 25, 2018.

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