How Health Care Regulation will Affect Seniors in Minnesota
by Julianne Johnston and Norm Hanson
Despite the Republican’s “No” and the Tea Party rhetoric, the Senate and House approved and the President signed into law the two bills which will begin the transformation of the health care system in the United States. The critics indicate that the US should not provide for adequate health care for children, seniors, unemployed, and other undeserving individuals who cannot “earn” the right to health care. Legislators’ lives have been threatened and bricks have been thrown. Those that voted or voiced their disapproval vow to repeal the legislation when they elect their people during the next election. Are we willing to give up health care to the demands of these dissidents? Let’s look at the facts for seniors (and soon to be seniors) in Minnesota.
The gap in coverage in the Medicare Part D prescription drug benefit, known as the Donut Hole, has been a financial hardship for an estimated 133,000 Minnesota seniors who have had to assume the full cost of prescribed medications for expenditures between $2700 and $6154. It has cost these Minnesota seniors an average of $4,080 per year. Under health care reform, these beneficiaries will receive the $250 rebate in 2010 and realize the 50% discounts on brand name drugs beginning in 2011 and complete closure of the donut hole within a decade. A typical beneficiary who enters the donut hole will see savings of over $700 in 2011 and over $3,000 by 2020.
The health care legislation creates immediate options for people who can’t get insurance today. 6 percent of people in Minnesota have diabetes, and 21 percent have high blood pressure – two conditions that insurance companies could use as a reason to deny health insurance coverage. Reform will establish a high-risk pool to enable people who cannot get insurance today to find an affordable health plan. Individuals with pre-existing conditions will no longer have to buy high risk and expensive health care while they wait to become eligible for Medicare in order to obtain health care coverage. Health reform will ensure that the 519,000 uninsured Minnesotans and 356,000 Minnesotans who purchase health insurance through the individual market have access to affordable health insurance options through state-based health insurance Exchanges. By reforming the insurance market and forcing insurance companies to compete for business through the Exchange, health reform will reduce family health insurance premiums by $1,590 – $2,270 for the same benefits. An estimated 71,900 people from Minnesota currently have early retiree coverage through their former employers, but early retiree coverage has eroded over time. A reinsurance program would stabilize early retiree coverage and provide premium relief to early retirees and could save families up to $1,200 on premiums.
The legislation improves Medicare benefits by providing free preventive and wellness care, improving primary and coordinated care, and enhancing nursing home care. The 747,000 Medicare beneficiaries in Minnesota will be eligible for a free, annual wellness visit and no cost-sharing for prevention services. Finally, by gradually moving to a more fair payment system for private insurance companies who participate in Medicare Advantage, health reform will lower Medicare costs for the 513,000 Minnesota seniors not enrolled in Medicare Advantage, by as much as $45 in premium costs each year. The bill will strengthen the Medicare Trust Fund, extending its solvency from 2017 to 2026.
It is estimated that 65 percent of those who are 65 years of age today will spend some time at home in need of long-term care services, which could cost $18,000 or more per year. This means that 410,000 older residents of Minnesota who are aged 55 to 64 today will need home health services after they turn age 65 – services that are not always covered by Medicare, Medicaid, or private health insurance. Health insurance reform will create a new voluntary long-term care services insurance program, which will provide a cash benefit to help seniors and people with disabilities obtain services and supports that will enable them to remain in their homes and communities. Reform will encourage states to expand their home and community based services through Medicaid by providing enhanced funding, and it will create a program to provide community support services for disabled Medicaid enrollees who would otherwise need to be in a nursing home. These programs could help improve care for many of the 112,000 disabled Medicaid beneficiaries in Minnesota.
The current health care system does not place enough emphasis on improving quality of care. For example, nearly 20 percent of Medicare patients who are discharged from the hospital end up being readmitted within 30 days. For Minnesota, that’s 38,700 readmissions each year which could potentially be prevented with improved care coordination. Health insurance reform will invest in innovations in primary care and will provide financial incentives to hospitals to better coordinate care at discharge to avoid preventable readmissions.
Finally, there have been many questions about how the recently passed national health reform legislation will affect military and VA beneficiaries. Defense Secretary Gates issued a statement prior to the passage of the health care legislation asserting that “Our troops and their families can be re-assured that the health care reform legislation being passed by the Congress will not negatively impact the TRICARE medical insurance program, as it already meets the bill’s quality and minimum benefit standards. This was clarified by a vote in the U.S. House of Representatives yesterday and is expected to be re-affirmed by the Senate.” Everyone in the Administration and both political parties agree that TRICARE and VA coverage will not be affected by changes in the health care law.
So, tell us, why are the Republicans and Tea Party protesters so against these reforms which would appear to benefit so many including them?