Affordable Care Act & Insurance: April 2013

Affordable Care Act

Healthcare currently costs 25% of the economy.  People are living longer with multiple conditions.  Because of the recent economic downturn, many of those 50+ have lost significant savings for their retirement.  This Act will provide everyone with affordable insurance.Here are the exceptions:

  1. Those 18 to 25 can get castastrophic insurance only.
  2. Those on Medicare will not need to be on it.
  3. Anyone objecting based on religious beliefs.

What It Covers

The Affordable Care Act is 900 pages outlining the following:

An insurance pool is being created which will provide health insurance to everyone regardless of pre-existing conditions.  The larger the pool, the more costs can be spread around.

  • 517804062dd50505ad723793There will be a 30-60 day enrollment period
  • If you have a change of life circumstance i.e. divorced or widowed, you will be able to get insurance immediately.
  • In the current version, doctors will be incentivized to talk to one another regarding the care of a patient.
  • If a person has low income, the government will pay their premium
  • If they are over 400% of poverty level, they will need to pay 10% of their income on insurance
  • Employers with over 50 employees will be required to provide insurance for them. There may be higher co-pays.
  • Doctors will be required to be online with medical records in 2014.
  • States will be required to have an exchange ready by January 2014 or to let the federal government handle it.  Missouri opted to have the federal government handle it.
  • Children can be on the parent’s policy until they are 26 despite living somewhere else.
  • Hospitals will be required to ensure that care continues upon discharge and there is no re-admittance within 30 days.  Hospitals will not be paid for infections picked up during the hospitalization.
  • Those in the age bracket of 55-64 will be charged more because they are likely to use more health care.  They will be asked if they smoke and if they are obese.

Possible Negative Consequences

Here are some possible negative consequences from the Act.  It is a starting point.

If employees work less than 29 hours, these employees will not be counted toward fines if the employer is not providing insurance.  Currently, taxes and fees in the law are directed to industry.
Women pay more for insurance over a lifetime because they have children; live longer and are more apt to use the system.
40% of rural hospitals will go out of business because they cannot afford to take in the uninsured.  Rural people will not have enough professionals to serve them.  They will be directed to the closest cities.   More will be served by Nurse-Practitioners.
Some insurance policies have been grandfathered in.  This will only continue if premiums are not changed or there are no other changes in the policy itself.
The cost of premiums may go up.

Understanding Medigap Policies

Medigap policies were put into place to cover out of pocket expenses that Medicare did not cover.  They offer 6 months of guaranteed issue meaning that you don’t have to qualify during that time period.  After that, you may have to meet certain criteria and premiums may be higher.
Here is what all Medigap plans A through N cover:
  • DepressedSeniorManCoinsurance for day 61-90 of inpatient hospitalization
  • Coinsurance for lifetime reserve days 91-150
  • Coverage for an additional 365 days of inpatient hospital care in your lifetime
  • Coverage for the first three pints of blood
  • Coverage for 20% coinsurance for Part B services
  • Coverage for hospice 5% coinsurance for Medicare-approved charges for inpatient respite care and 5% coinsurance for prescription pain medications
 The plans A through N differ in what they cover from this point.  Some offer coverage for foreign travel emergency, portions of the skilled nursing coinsurance, coverage of Part A deductibles and out of pocket expense.
 These plans offer a Special Trial Right to try out the Advantage Plans for up to a year.  They give you the right to convert back at any time during that year if you are dissatisfied with the plan.  On the website, there is a listing of star rated plans.  These are plans that have a higher rate of customer satisfaction.  If you are on a lower rated plan, Medicare will notify you so that you can switch to a higher rated plan during your next Open Enrollment period.
Open Enrollment for the Medigap policies is the anniversary date of your policy so it is unique to the person being insured.