How Health Reform would affect
Kim & Oscar: retirees with Medicare Advantage coverage
Kim, 70, and Oscar, 74, don’t have traditional Medicare, but a privately run “Medicare Advantage” plan that covers the same services as Medicare, plus extra benefits (like eyeglasses). They know this program by the name on their insurance card, and may not be familiar with the term Medicare Advantage.
Under the Proposed Health Reform Bills:
CHOICES
- Kim and Oscar will still have the option of enrolling in a Medicare Advantage plan.
- As they do now, Kim and Oscar also have the option of enrolling in "traditional” Medicare.
- Some Medicare Advantage plans may alter their benefits due to changes in the way they are paid by the Federal government.
COSTS
- Medicare will stop paying private insurance companies extra to enroll seniors in Medicare Advantage plans. Today, these plans are paid roughly 14% more than what the same senior would cost in traditional Medicare and this has accelerated the depletion of the Medicare trust funds. Aligning the costs of Medicare Advantage plans with traditional Medicare will save taxpayers money and help ensure that either type of coverage will be sustainable in the future.
- Medicare Advantage plans are prohibited from charging cost-sharing that is higher than that charged under traditional Medicare.
- Under either program, the couple won’t have to pay for preventive services like physicals, mammograms, glaucoma screening and other services.
DIFFERENCES
House bill (H.R. 3962, passed November 7, 2009):
- Under this proposal, "equivalency" between traditional Medicare and Medicare Advantage is phased in starting in 2011 and ending in 2013.
Senate bill (H.R. 3590, passed December 24, 2009):
- Under this proposal, "equivalency" between traditional Medicare and Medicare Advantage is phased in starting in 2012 and ending in 2015, with special transition assistance for regions which currently have very high levels of Medicare Advantage benefits.