The LuLac Edition #2166, August 20th, 2012
ANOTHER REPUBLICAN LIERepublicans are running around the country this election season (some with their moms) saying that the Affordable Health Care Law and by extension President Obama is cutting million of dollars of Medicare for senior citizens. As usual, this is WRONG! That Medicare money is actually going into the Health Care Law as a way of helping seniors. True, the money is being diverted but seniors aren’t going to be losing anything. The money is coming from a program called Medicare Advantage. This was put into operation in 1997 as part of the balanced budget act of 1977. Here’s an overview of what Medicare Advantage is and how it differs from traditional Medicare:
Medicare Advantage subscribers generally pay a fixed amount (a copayment of $20, for example) every time they see a doctor as opposed to meeting a deductible and paying a coinsurance (typically 20%) under Original Medicare. The copayment can be higher to see a specialist with a Medicare Advantage plan. Under Original Medicare the coinsurance remains 20%, but the actual amount out of pocket can be higher since specialists generally charge more for services. The private plans are required to offer a benefit “package” that is at least as good as Medicare’s and cover everything Medicare covers, but they do not have to cover every benefit in the same way. Plans that require higher out-of-pocket costs than Medicare for some benefits, like skilled nursing facility care, can balance their benefits package by offering lower copayments for doctor visits. A private plan may use some of the excess payments they receive from the government for each enrollee to offer supplemental benefits. Many plans use the excess subsidies to offer hearing coverage, vision coverage, gym memberships and other services not covered by Medicare. As with traditional Medicare, private plan members can incur high out-of-pocket costs, however Medicare Advantage plans typically have an out of pocket maximum ($6,700 for example), which can protect individuals against catastrophic medical bills. Once the out of pocket maximum is reached for an individual, the plan will pay 100% of Medicare approved services for the remainder of the calendar year, with no lifetime maximum, so long as individuals use in-network providers. If individuals voluntarily choose to use out-of-network providers, they generally must pay the full cost of their care and there is no out-of-pocket cap on their expenses. This can be a problem for people with Medicare with costly conditions, who need to use out-of-network specialists or who are hospitalized and are forced to use out-of-network doctors while in the hospital. By law, however, if a patient's in-network physician orders tests or procedures that are not available or provided by any in-network facility or specialist's office, the Medicare Advantage plan must pay for the patient's procedures or services at an out-of-network location at no additional cost to the patient, so long as the necessary services are normally covered by Medicare.
The other money coming out of the current Medicare set up is the Prescription Drug Plan that was passed in 2003. This is the plan that gave the seniors “the donut hole”. A simple explanation of the donut hole is this: If you have a Medicare Part D prescription drug plan, the donut hole is when Medicare temporarily stops paying for your prescriptions. If you are in the donut hole, you have to pay the entire cost of your medications. After a Medicare beneficiary surpasses the prescription drug coverage limit, the Medicare beneficiary is financially responsible for the entire cost of prescription drugs until the expense reaches the catastrophic coverage threshold. With the passage of the Patient Protection and Affordable Care Act of 2010, people who fall within the doughnut hole will receive a $250 rebate within three months of reaching the coverage gap to help with payments. Seniors in this area already got this.
The U.S. Department of Health and Human Services estimates that more than a quarter of Part D participants stop following their prescribed regimen of drugs when they hit the doughnut hole The 2010 Health Reform bill (Patient Protection and Affordable Care Act) began to address the coverage gap by creating discounts on brand name and generic drugs purchased within the gap range. Between now and 2020, the gap will gradually be closed to a point where it is completely eliminated.
So when the GOP ticket starts telling you how Obama cut Medicare, remember these facts. The GOP is lying about health care and Medicare. To me, if the stakes weren’t so high in this Election, it would be funny. It’s almost like the GOP running mates are like the kid who kills his parents and then asks for understanding because he is after all, an orphan.