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Affordable Care Act Update

Changes stemming from the 2010 health care reform legislation are already in place. Learn what's coming in 2011 that could lower your costs and make care more accessible.

When uninsured Americans rush into a hospital needing emergency care, they receive treatment, regardless of their ability to pay. But someone has to pay for the team of professionals who care for these people, as well as the equipment and medicines housed in facilities across the country that treat them. That someone is a combination of your tax dollars (used to fund various social services programs) coupled with premiums paid by consumers who have insurance (and who likely pay excessive premiums to fill in the gaps that an estimated 50 million uninsured Americans cannot afford).

In March 2010, however, President Obama signed into law the Affordable Care Act, which is designed to alleviate situations like this and other ailments in our healthcare system. The law will:

  • Require individuals to purchase health care insurance by 2014 through plans designed to lower costs
  • Prevent costly illnesses through free preventative care
  • Provide greater access to benefits
  • Improve the quality of the health care system

So whether you're someone who is frustrated by excessive premiums or whether you haven't been able to qualify for, or afford, coverage in the past, help is coming.

Changes stemming from the Affordable Care Act are being rolled out over several years, and many benefits have taken effect already, including bans on the worst insurance company abuses; cost savings for seniors, families and small and large businesses; and coverage options for many Americans who have been locked out of the insurance market due to preexisting conditions.

What follows are updates to CareOne's previous coverage of this topic and highlights of the changes to come in 2011.

Improving Quality and Lowering Costs for Seniors

Several changes that took effect on January 1, 2011 benefit seniors covered by Medicare. If these changes don't impact you, perhaps you have an aging family member or friend with whom you can share this information:

  • Prescription drug discounts. Seniors who reach the Medicare drug coverage gap will receive a 50% discount when buying Medicare Part D-covered, brand-name prescription drugs. Over the next ten years, seniors will receive additional savings on brand-name and generic drugs until the coverage gap is closed in 2020. (The Medicare drug coverage gap occurs when seniors max out their drug benefits under Medicare and have to cover such expenses out-of-pocket.)
  • Free preventative care. Certain preventative care services will be free for seniors on Medicare, such as annual wellness visits, personalized prevention plans, colorectal cancer screenings and mammograms.
  • Improved care for seniors following hospitalization. The Community Care Transitions Program will help high-risk Medicare beneficiaries who are hospitalized avoid preventable readmissions by coordinating care and connecting patients to services in their communities.

To learn more about improvements to Medicare call 1-800-MEDICARE or go online at Medicare.gov. Additionally, visit the Eldercare Locator, a public service of the U.S. Administration on Aging, to access home- and community-based services and benefits in your area, such as counseling, transportation, meals, home care, and caregiver support services. You can also call 1-800-677-1116.

More Value for Your Premium Dollars

Other mandates that took effect January 1, 2011 benefitted a wider group of Americans, with the goal of lowering health care premiums and helping consumers get more value for their health care dollars:

  • More control over how insurance companies spend collected premiums. If insurance companies fail to direct certain percentages of their premium dollars collected from large (85%) and individual or small employers (80%) toward health care services/benefits and quality improvement, then they must provide rebates to consumers.
  • New strategies for quality improvement. A new Center for Medicare & Medicaid Innovation will test new ways of delivering care to patients, and improve the quality of that care while lowering the rate of growth in costs for Medicare, Medicaid, and the Children's Health Insurance Program. Additionally, the U.S. Department of Health and Human Services (HHS) is expected to deliver a national strategy for quality improvement in health care, including these programs in the near future.

Finally, there are a few noteworthy changes that will take effect October 1, 2011:

  • Funding for an advisory board. A new Independent Payment Advisory Board will develop proposals to share with Congress and the President, aimed at extending the life of the Medicare Trust Fund, which is used to fund the Medicare system. The board will look to identify waste in the system and suggest cost-cutting measures, while expanding access to quality care.
  • Increased at-home and community services for the disabled. A new Community First Choice Option allows states to offer home- and community-based services to disabled individuals through Medicaid rather than institutional care in nursing homes.

Constitutionality Debate Continues

As the government continues implementing new programs mandated by the Affordable Care Act, some critics contend that the health care reform legislation is unconstitutional, meaning the U.S. government actually lacks the power to force Americans to purchase health care insurance and face monetary penalties and fees if they fail to make such purchases - as required by language in the law by 2014 and typically referred to as the "individual mandate".

At the time of this writing, more than 20 lawsuits challenging the law's constitutionality, and the individual mandate in particular, were working their way through U.S. federal courts. Many legal experts believe this issue will eventually be handed over to the U.S. Supreme Court to decide.

Regardless of these tactics, changes stemming from the legislation continue to be implemented. We will keep monitoring this issue, and will share any details that could affect your ability to access and afford health care coverage with you.

In the meantime, bookmark the HHS' health care website for future reference. The site breaks down the new law and provides links to information such as state-specific private insurance plans, public programs and community services that may be available to you. Stay tuned for future updates.

For more helpful advice, check out our Health and Fitness for Less Tips.

Take control of your finances with our debt help tools. Use our calculators and budget planner to help you manage your money.

For more information on personal finance, or debt consolidation, search the CareOne Credit Knowledge Center Articles.

To learn about our debt relief plans, see the CareOne Credit Quick Answer Guide.

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