Medicare offers comprehensive healthcare coverage, but even with the new Affordable Care Act (aka, “ObamaCare”) law in place it doesn’t cover everything. In fact, it’s only designed to cover about 80% of your doctor and hospital expenses.
To fill the coverage gaps, private insurance carriers offer supplemental insurance. You can also choose to buy approved health insurance coverage through private insurers instead of getting private fee for service benefits from the federal government. These Medicare alternatives are rapidly gaining popularity.
Medicare products and services are easily broken down into four key components:
- Hospital Coverage (Part A)
- Doctor Coverage (Part B)
- Medicare Advantage Plans (Part C, privatized coverage for Parts A and B)
- Medicare Prescription Drug Plans (Part D)
- Medicare Supplement Plans (Medigap)
The Medicare program does not include coverage for dental, vision or hearing. You must purchase insurance or a discount plan on your own for these services. Medicare also does not cover the costs associated with nursing homes, assisted living, or home healthcare, unless these services are needed as part of in-patient treatment after a stay in the hospital (as prescribed by your doctor).
If you meet the financial requirements, your state can assist you with many of the healthcare costs that are not covered by Medicare through the Medicaid program. The level of assistance you can receive is based on need. Contact your state Medicaid office for more details.
New Healthcare Reform Benefits
Starting in year 2014, the ObamaCare law brings several benefits to Medicare recipients that are designed to significantly assist beneficiaries. Medicare reform includes additional health checkup benefits and a gradual closing of the prescription drug plan donut hole. Closing the donut hole offers significant cost savings for most seniors.
Medicare Reform Changes that Affect Seniors
The ObamaCare law initiates wide-sweeping healthcare reform in the United States through a series of regulations that attempt to limit what healthcare providers and health insurance carriers can charge for their services. This is a bold move by the Obama administration that could have serious unintended consequences. All seniors should take the necessary steps to make sure they have the insurance coverage they need.
Linking Payment to Quality Outcomes
The new healthcare law establishes a hospital Value-Based Purchasing program (VBP) in Original Medicare. This program offers financial incentives to hospitals to improve the quality of care. Hospital performance is required to be publicly reported, beginning with measures relating to heart attacks, heart failure, pneumonia, surgical care, health-care associated infections, and patients’ perception of care. (Effective for payments for discharges occurring on or after October 1, 2012)
Expanded Authority to Bundle Payments
The ObamaCare law establishes a national pilot program to encourage hospitals, doctors, and other providers to work together to improve the coordination and quality of patient care. Under payment “bundling,” hospitals, doctors, and providers are paid a flat rate for an episode of care rather than the current fragmented system where each service or test or bundles of items or services are billed separately to Medicare. For example, instead of a surgical procedure generating multiple claims from multiple providers, the entire team is compensated with a “bundled” payment that provides incentives to deliver health care services more efficiently while maintaining or improving quality of care. It aligns the incentives of those delivering care, and savings are shared between providers and the Medicare program.
No Discrimination Due to Pre-Existing Conditions or Gender
The new healthcare law implements strong reforms that prohibit insurance companies from refusing to sell coverage or renew policies because of an individual’s pre-existing conditions. Also, in the individual and small group market, it eliminates the ability of insurance companies to charge higher rates due to gender or health status. (Effective January 1, 2014)
Paying Physicians Based on Value Not Volume
A new Affordable Care Act provision will tie physician payments to the quality of care they provide. Physicians will see their payments modified so that those who provide higher value care will receive higher payments than those who provide lower quality care. (Effective January 1, 2015)