Monday, August 9, 2010

Medicare revisited

Medicare celebrated its 45th birthday on July 30.

In 1965, President Lyndon B. Johnson signed the Medicare bill into law, providing government-sponsored health insurance for Americans 65 and older and younger people with disabilities.

Although every senior in the United States grew up without Medicare, most Americans today accept this single-payer, government-created and government-administered system as one of their rights as citizens, much like the right to vote.

Yet before we reach the age of 65, most of us don't have a clue how Medicare works. We only know it's there.

Misunderstandings about the Medicare program surfaced during recent discussions over the administration's sweeping health reform bill that finally passed in March.

Unclear on the concept, elders in some states vented outrage against the Obama administration, whose bill included Medicare changes, for "meddling" in "their" Medicare.

Others, also unclear on the facts, protested a provision in the bill that would have reimbursed physicians for time-consuming conversations with patients and family regarding the patient's wishes at the end of life. Mistakenly condemning these as "death panels," they raised loud and confusing voices, and the provision was removed from the bill.

But the uninformed ranters remain. To help clarify confusion, here are a few basic facts.

The health reform bill proposed by President Obama and passed by the
Congress in March is called the Affordable Care Act. You will often hear bureaucrats referring to ACA. They mean the new health care law.

Among the most immediate changes:

# The infamous "doughnut hole," in which Medicare recipients must pay full price for their medication, will close completely by 2020. This year, those in the hole will receive a $250 rebate. Starting in 2011, a 50 percent discount will be available for brand-name drugs.

# The open-enrollment period, during which a Medicare recipient may choose a prescription drug program, will be extended.

# Starting in 2011, co-payments or deductibles will be removed for annual checkups and mammograms, colonoscopies and some other preventive tests. There will be no charge for these tests.

Other provisions are designed to improve delivery of medical care, prevent frequent readmissions to hospitals and, in the process, cut health care costs.

According to the Kaiser Health Foundation, nearly 18 percent of hospital admissions among Medicare beneficiaries in 2005 occurred within 30 days of being discharged from the hospital. Critics of high costs say that readmission can be prevented by better care in the hospital and improved coordination between patients and doctors after release.

Until now, hospitals, paid separately for each hospital stay, have had no incentive to prevent readmission, experts say. Under the new law, payments to certain hospitals with high readmission rates will be reduced starting in 2013, a spokeswoman for the federal Centers for Medicare & Medicaid Services said in a phone interview.

Among health care providers, pilot projects to streamline health care delivery and coordinate care are already underway.

These are only a few of the changes and modifications included in the new law.

For more information, call the Health Insurance Counseling Advocacy Program (HICAP) at 650-627-9350 or 800-434-0222.