4 Things Elders Need to Know About the New Healthcare Bill

On March 23rd, 2010, President Obama signed into law The Patient Protection and Affordable Care Act, a sweeping bill that changed the face of health insurance in the United States.  This bill included four significant changes for health insurance with regards to elders, and one should read about these changes in order to take advantage of them.  Here are the four most important parts of the law.

1.  The CLASS Act

The Community Living Assistance Services and Supports, or CLASS Act, is a long-term care insurance benefit.  It provides employed workers with a voluntary option to contribute premiums, which will work like other premiums such as dental insurance that go through a payroll deduction.  Employers are not required to provide the benefit; employees whose companies do not offer the benefit and self-employed people will be able to enroll through a governement plan.  Like many of the provisions in the new law, details of this program have not been finalized.  Individuals will qualify to receive this benefit after meeting three stipulations: they need help with certain activities of daily living, have paid the premiums for five years, and have worked for at least three of those five years.  The liftetime cash benefit will depend on the degree of impairment.  This figure is expected to average $75 a day, which equals out to $27,000 each year.  This money can be used to cover costs at home or at an assisted living facility or nursing home.

2.  Medicaid

In 2014, Medicaid will be made available to all legal residents living at 133% of the poverty level (the poverty level in 2010 registered at a $10,830 yearly income for an individual and $22,050 for a family of four).  A big aspect of this change is that childless adults will now be eligible for Medicaid.

3.  Medicare Cuts

There will be no funding cuts for recipients of regular Medicare.  The government funds will, however, cut funding for Medicare Advantage, a program that uses private firms to provide Medicare coverage.  These cuts begin in 2011 and will gradually increase.

4. The "doughnut hole"

A large part of the healthcare bill that will affect seniors is a revision to the "doughnut hole."  The donut hole is a controversial section of Part D of Medicare's prescription drug benefit.  According to the article "Most seniors unaware healthcare reform closes Medicare's 'donut hole'" published in http://www.thehill.com/, "In 2010, it works like this: Part D beneficiaries pay 25 percent of their drug costs until total expenses hit $2,830. At that point, seniors are responsible for the full cost of the next $3,610 worth of drugs. After total annual costs hit $6,440, the government picks 95 percent of the tab for the rest of the year."  Accordingly, because of the healthcare reform law, this year name-brand drugs will be half price while in the donut hole section, and in 2020 the donut hole will be closed entirely. 

These are four important parts of the new healthcare legislation.  As always, if you have any questions, feel free to ask!