Obamacare Ruling and Medicare Explained

What Obamacare means for seniors and other people on Medicare

You may have read our previous article on the Obamacare Ruling and Medicare, but you may be asking yourself, “What does this all mean for Medicare?”President Obama’s Affordable Health Care Act, recently upheld in a 5-4 decision by the US Supreme Court, addresses at least two areas of significance to those on Medicare.

The Act provides for an increase in preventive health services, an area often overlooked by Medicare and other insurers.

Preventive health provisions of the Act have already taken effect. According to NPR, the Centers for Medicare & Medicaid Services (CMS) reported that more than 14 million Medicare users received at least one free preventive health service during the first five months of 2012. NPR also reported that the law includes potentially far-reaching changes making it easier for seniors to receive medical services in their homes instead of at such institutional settings as nursing homes.

—For more on the Affordable Care Act check out “Know Your Benefits”—

As far as Medicare is concerned, Obamacare may impact most heavily on prescription drug costs paid by those enrolled in Medicare Part D.

Currently, Medicare Part D recipients enter an initial coverage period after their deductible is met. During this initial coverage phase, the recipient’s prescription drug plan pays its share for each covered drug until the combined amount, including the deductible, reaches $2,930.

Once the recipient and his or her Medicare prescription drug plan have reached the combined $2,930 threshold, the Medicare Part D recipient is said to be in the Donut Hole period. During this stage the recipient normally has to pay prescription drug costs out of pocket until total out-of-pocket costs reach $4,700.

According to NPR, the law, over several years, is set to reduce the amount of money that Medicare drug plans can charge individuals for drugs when their coverage lapses in the donut hole. NPR reported that the price reductions that have already taken effect have saved Medicare consumers billions of dollars in drug costs.

Specifically, the Affordable Care Act provides seniors a 50% discount on covered brand name Medicare-approved medications and a 14% discount on covered generic drugs. According to Max Richtman, head of the National Committee to Preserve Social Security and Medicare, “You will get more and you will pay less for it. Seniors already have saved billions in drug prices. The average Medicare beneficiary will continue to save about $650 a year. That’s real money, especially to seniors.”

Also read our previous article on the Obamacare Ruling and Medicare

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