Change of Plans
The US health care system is on the verge of getting some reforms. Naturally people are speculating and apprehensive about the new rules and concerned regarding the status of the existing system. The older generation is more so because for them affordable health care is a priority. They would like to know how Medicare, their primary health insurance program, will be affected by the reforms, called the Affordable Care Act.
Medicare at a Glance
It will be worthwhile to go over the tenets of this program and its subsidiary plans before addressing the concerns regarding the new rules.
Eligibility for Medicare
Parts of Medicare
The basic parts are -
This covers the hospitalization expenses.
This covers the outpatient health care costs
These two parts are offered by the government directly. However there are more options if a person wants larger coverage. These are available from private insurance companies.
also called the Medicare Advantage Plan has no out-of-pocket expenses but members have to remain within the network of healthcare providers to get the benefits.
this covers the prescription drugs expenses
Medicare Supplemental Plan
Popularly known as Medigap, this is an additional plan people can take with basic plans to cover the out-of-pocket expenses associated with them. This plan can also be used to cover expenses for dental, vision and long term care which are excluded from the Original Medicare plans. These plans are provided by private companies but they have to strictly adhere to the government specifications. Medigap has several choices of plans under it with varying benefits.
When can You Buy Medicare Supplemental Plans
There are specific periods during the year when you can purchase these plans.
This starts from the day you turn 65 and continues for six months thereafter. You can purchase your policy during this time. The advantage of getting your policy during this period is that you will not be rejected by the insurance company not even on grounds of pre-existing conditions. Applications outside this period are subject to more scrutiny and approval is not guaranteed. Medicare Advantage plans also have an Initial Enrollment Period thereby followed by an Annual Enrollment Period starting in mid October.
Basic Queries Regarding Medicare Plans and Its Supplements
The following segment will put to rest some basic concerns you might have regarding the changes in the existing program.
It is possible to change your plan under the four possible situations -
Though these changes are possible, they are subject to fresh medical assessment of the applicant. Also the enrollment periods need to be overlapping in order to make a smooth transition when switching programs.
Effect of Affordable Care Act on The Medicare Plans
It seems clear that both Advantage and Supplement plans will continue to be available even after the implementation of ACA. However the government endowment which supports the Medicare Advantage plans will be greatly reduced. The ACA also aims at minimizing its control over the rates of the Medicare Supplement companies so they can raise their rates as they wish.
Phasing out of Medicare Advantage
There are a substantial number of senior citizens who are already enrolled in the Medicare Advantage plans and are satisfied with the benefits. In case of a phase-out of these plans they would have to move to Medicare Supplemental plans since insurance providers will discontinue the plans or members will have to pay huge premiums. However this need not be done immediately. In order to soften the effect of the first stage of the phase-out the government plans to pump in a big amount. This would extend the financial support to the program for about one more year.
How Soon should You Change Over
As the situation seems, the debate and deliberation over ACA is still going on and the Supreme Court has yet to give its final verdict. So there is no need to panic. If the insurance companies find some of the prescribed rules too strict they may opt out of the market changing the whole scenario.
Whether the new reforms will take place and to what extent is still open to debate. One possible situation is also the fact that the whole act may not come into effect at all keeping things as is. So it is a good idea to be aware of the probable changes and plan things out but immediate action is not required.
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