Federal Healthcare Reform Key Provisions Taking Effect in 2011

While many components of the law will not occur until 2014, some key provisions do go into effect in 2011:

Beginning in January, 2011:

·        Seniors who reach the coverage gap will receive a 50% discount when buying Medicare Part D covered brand-name prescription drugs. Over the next 10 years, seniors will enjoy additional savings on brand-name and generic drugs until the coverage gap is closed in 2020.

·        The new law provides for certain free preventative services, not subject to coinsurance or deductible, such as wellness exams, colonoscopy, and mammography.

·        To insure that premium dollars are primarily spent on healthcare and claims, the new law requires that at least 85% of all premium dollars collected from large employer plans be spent on health care services and health care quality improvement. For individual and small group plans, at least 80% of the premium must be spent on benefits and quality improvement. If insurance companies do not meet these requirements because their administrative costs and profits are too high, they must rebate a portion of the premium back to the consumer.

·        The Medicare Advantage program funding for seniors is being significantly cut back. Somewhere in the vicinity of $500,000,000 is being cut from this popular program. This program used to pay the insurance company as much as $1000 more per person than the per person amount spent in original Medicare. This popular program funding is being eliminated and all that will ultimately be left will be some bonus payments to Medicare Advantage plans that “provide high quality care”.  This part of Obamacare came right out of the pockets of many of our seniors on Medicare.

·        The “Community Care Transitions Program” will help high-risk Medicare beneficiaries, who are hospitalized, avoid unnecessary readmission, by coordinating care and connecting patients to services in their communities.

·        Distributions from Health Flexible Spending Accounts and Health Reimbursement Arrangements will only be allowed to reimburse the cost of over the counter medications, if they are purchased with a prescription. This new rule does not apply to reimbursement for the cost of insulin, which will continue to be permitted to be purchased and reimbursed, even if without a prescription.

First Quarter of 2011 News:

·        At least 637,000 young adults are getting coverage under their parents’ health plans as provided for under this federal law. The Act requires health insurance plans to allow young adults up to age 26, to be covered under their parents’ plan, even if  the young adult is a full-time student, not living with or a dependent of the parent, or even if they are married.

Beginning October 1, 2011:

·        The “Independent Payment Advisory Board” will begin operations to develop and submit proposals to Congress and the President, aimed at extending the life of the Medicare Trust Fund. The board is expected to focus on ways to target waste in the system and recommend ways to reduce costs, improve health outcomes for patients, and expand access to high-quality care.

·        The new “Community First Choice Option” will allow states to offer home and community-based services to disabled individuals through Medicaid, rather than through institutional care in nursing homes.

For more information on these or other health insurance issues, call Andy Hesch of Health Choice One at 303-241-8155 or email me at andyih@msn.com. Please also visit my website at www.heschinsurance.info/  and get a free insurance quote or learn more about Colorado health insurance agent Andy Hesch.