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Tuesday, April 20, 2010

Improving Medicare

Tara Bostock

Staff Writer

The health reform debate produced a lot of misinformation about how the health reform bill would change Medicare. Much of it focused on false claims of cuts to benefits, the infamous death panels, or hurting granny. Now that the reform bill has been signed by President Obama, it's time to set the record straight on how reform will really affect Medicare and its beneficiaries.

Closes the "Doughnut Hole": Currently, Medicare's prescription program (Medicare Part D) has a gap in coverage. This gap is commonly referred to as the "doughnut hole." How does the doughnut hole work? Well, say your dad (a Medicare recipient) has several medications that he needs to take every day to keep his blood pressure down, to treat his diabetes, or to relieve pain from arthritis. With Medicare Part D, he pays a deductible and then 25 percent for the cost of these drugs until the total costs of the prescriptions reach a certain level (this payment structure is typical, but some plans charge flat copayments instead of a deductible and 25 percent). Then, he enters the doughnut hole, where he has to pay 100 percent of the cost of his drugs even though he is already paying premiums. Under the current system, your dad would have to pay $3,610 out of pocket before Medicare would cover the costs of his drugs again. The health reform legislation shrinks the doughnut hole over time. In 2010, people in the doughnut hole will receive a $250 rebate, and starting in 2011, they will get a 50 percent discount on brand name drugs and other discounts on generics. These discounts will increase each year until the doughnut hole is eliminated by 2020.

Provides Preventive Services: Preventive services can be expensive through Medicare. But they are extremely important in finding illnesses and conditions and preventing them from getting worse. With health reform, preventive services for those with Medicare will be free. Medicare will also finally cover an annual wellness visit (basically an annual physical), which will encourage beneficiaries to visit their doctors to talk about staying well-instead of just making appointments when they get sick.

Secures Medicare's Future:  Without reform, it was projected that Medicare would have insufficient funds as early as 2017. Reform extends the life of Medicare by nearly 10 years without cutting any of beneficiaries' guaranteed benefits.

So reform actually protects grandma-and grandpa, and mom, and dad-and you too.