THE ACATHE ACAAND YOUAND YOU

AND MEDICARE TOOAND MEDICARE TOO

Angela ZeekAngela Zeek

Bluegrass SHIP CoordinatorBluegrass SHIP Coordinator

20132013

Affordable Care Act Affordable Care Act (ACA)(ACA)

ACAACA

Signed into law on March 23, 2010Signed into law on March 23, 2010 Created health insurance Created health insurance

marketplaces for the uninsured to marketplaces for the uninsured to buy insurancebuy insurance

Made a number of changes to Made a number of changes to MedicareMedicare

The ACA and MedicareThe ACA and Medicare

Many believe that rate of Many believe that rate of spending on Medicare spending on Medicare cannot be sustainedcannot be sustained– The number of people

with Medicare will grow rapidly as Boomers age

10,000 people turning 65 every day for the next 20 years

– Medicare spending is increasing faster than the rest of the economy

Millions with Medicare

2013 2030

50 79

1 2

ACA Changes to Medicare Finances

Increased RevenuesIncreased Revenues– Higher payroll taxes for wealthy Higher payroll taxes for wealthy

workers ($200/$250,000)workers ($200/$250,000)– Higher Part D premiums for 5% of Higher Part D premiums for 5% of

wealthy Medicare beneficiaries wealthy Medicare beneficiaries ($85/$170,000)($85/$170,000)

Reduced SpendingReduced Spending– Slower growth in payments to Slower growth in payments to

providers (not doctors)providers (not doctors)– Reduction in over-payments to Reduction in over-payments to

Medicare Advantage plansMedicare Advantage plans– Average yearly Medicare spending Average yearly Medicare spending

increases down from increases down from 6.8% to 5.7%6.8% to 5.7%– NO CUTS NO CUTS in basic benefitsin basic benefits

Reduced Payments to Medicare Reduced Payments to Medicare Advantage PlansAdvantage Plans

MA plans were paid MA plans were paid about $1,000 more per about $1,000 more per person than people in person than people in original Medicare (14% original Medicare (14% higher)higher)

Beginning in 2012, Beginning in 2012, these overpayments these overpayments started to be gradually started to be gradually reducedreduced– Exception- higher Exception- higher

performing plans will performing plans will receive bonusesreceive bonuses

The ACA Financial Changes to The ACA Financial Changes to MedicareMedicare

Prior to the ACA, Medicare Trust Prior to the ACA, Medicare Trust Fund would be depleted by 2017. Fund would be depleted by 2017.

Trust Fund is projected to be Trust Fund is projected to be solvent until roughly 2029 due to solvent until roughly 2029 due to the changes the changes

Increased funding to improve some Increased funding to improve some Medicare benefitsMedicare benefits

How These Changes Affect How These Changes Affect YouYou

– Medicare Prescription Drug Medicare Prescription Drug ImprovementsImprovements

– Better Preventive and Chronic Better Preventive and Chronic CareCare

– Better quality of careBetter quality of care

How These Changes Affect How These Changes Affect YouYou

Improvements in Improvements in Medicare Prescription Medicare Prescription Drug CoverageDrug Coverage

– Closing the Donut Closing the Donut Hole (coverage gap)Hole (coverage gap)

Phase Out of Donut Hole for Phase Out of Donut Hole for Brand Name MedicationsBrand Name Medications

Year

Pharmaceutical Manufacturer Discount

Government Subsidy (paid through plans)

Consumer Responsibility

2013 50% 2.50% 47.50%

2014 50% 2.50% 47.50%

2015 50% 5% 45%

2016 50% 5% 45%

2017 50% 10% 40%

2018 50% 15% 35%

2019 50% 20% 30%

2020 50% 25% 25%

Phase Out for Donut Hole for Phase Out for Donut Hole for Generic MedicationsGeneric Medications

Year Government Subsidy (paid through plans) Consumer Responsibility

2013 21% 79%

2014 28% 72%

2015 35% 65%

2016 42% 58%

2017 49% 51%

2018 56% 44%

2019 63% 37%

2020 75% 25%

How These Changes Affect How These Changes Affect YouYou

Improvements in Medicare Improvements in Medicare Prescription Drug CoveragePrescription Drug Coverage

– Improved appeals for Improved appeals for coverage denialscoverage denials

– More help for people More help for people with limited means with limited means

– For certain illnesses all For certain illnesses all medications medications manufactured to treat manufactured to treat those conditions must those conditions must be added to a plan’s be added to a plan’s formulary formulary

How These Changes Affect How These Changes Affect YouYou

Better Preventive CareBetter Preventive Care– Free annual wellness visit and prevention planFree annual wellness visit and prevention plan– No more cost sharing – free preventive benefitsNo more cost sharing – free preventive benefits– More funding for prevention servicesMore funding for prevention services

How These Changes Affect How These Changes Affect YouYou

Better Chronic Care New quality New quality

improvementsimprovements Better coordination Better coordination

among doctors, among doctors, specialists, other specialists, other providersproviders

Services to reduce Services to reduce hospital readmissionshospital readmissions

Help so you can Help so you can manage your own caremanage your own care

How These Changes Affect How These Changes Affect YouYou

Changes in Medicare Changes in Medicare Advantage (MA) Plans?Advantage (MA) Plans?

– New bonuses to reward New bonuses to reward high quality carehigh quality care

– New consumer New consumer protections to limit out-protections to limit out-of-pocket costsof-pocket costs

The ACA and Health Insurance The ACA and Health Insurance MarketplacesMarketplaces

ACA created marketplaces for ACA created marketplaces for uninsured individuals and insured uninsured individuals and insured individuals with high premiums to individuals with high premiums to purchase health insurancepurchase health insurance

Insurance sold under the marketplace Insurance sold under the marketplace offered by private companies offered by private companies

Kentucky’s marketplace is called Kynect Kentucky’s marketplace is called Kynect (kynect.ky.gov)(kynect.ky.gov)

Over 600,000 Kentuckians are Over 600,000 Kentuckians are uninsureduninsured

The ACA and health insurance The ACA and health insurance marketplacesmarketplaces

Insurance plans will be placed into categories Insurance plans will be placed into categories based on level of coveragebased on level of coverage– Bronze, silver, gold and platinumBronze, silver, gold and platinum

Individuals can compare the coverage and Individuals can compare the coverage and determine which type is best for themdetermine which type is best for them

Assistance in the way of tax credits are Assistance in the way of tax credits are available to people to reduce the cost of available to people to reduce the cost of premiumspremiums– To determine approximate credit and premium To determine approximate credit and premium

amounts visit, amounts visit, http://http://kff.orgkff.org/interactive/subsidy-calculator//interactive/subsidy-calculator/

The ACA and MedicaidThe ACA and Medicaid

Governor Beshear Governor Beshear expanded Medicaid expanded Medicaid to include anyone to include anyone with income of with income of 138% fpl or below138% fpl or below

Over 300,000 Over 300,000 Kentuckians will be Kentuckians will be eligible for Medicaid eligible for Medicaid benefits under the benefits under the expansionexpansion

Family Size

Monthly Income

1 $1,321

2 $1,784

3 $2,247

4 $2,710

The ACA and health care The ACA and health care marketplacesmarketplaces

Enrollment begins October 1 and Enrollment begins October 1 and ends March 31 for the first yearends March 31 for the first year– October 1 to December 7 in 2014 and October 1 to December 7 in 2014 and

beyondbeyond Coverage is effective January 1 if Coverage is effective January 1 if

enrollment happens prior to enrollment happens prior to December 15December 15

People on Medicare are not allowed People on Medicare are not allowed to participate in the marketplaceto participate in the marketplace

Medicare UpdatesMedicare Updates

Original Medicare Original Medicare (Part A & Part B)(Part A & Part B)

Outpatient Mental Outpatient Mental Health CareHealth Care

After Part B deductibleAfter Part B deductible– For visits to diagnose conditionFor visits to diagnose condition

Beneficiaries pay 20% of Medicare-Beneficiaries pay 20% of Medicare-approved amountapproved amount

– For outpatient treatment (such as For outpatient treatment (such as psychotherapy)psychotherapy)

In this YearIn this Year Beneficiaries PayBeneficiaries Pay

20132013 35%35%

20142014 20%20%

National Mail Order Program National Mail Order Program for Diabetic Testing Suppliesfor Diabetic Testing Supplies Effective July 1, 2013Effective July 1, 2013 Includes all parts of the United States Includes all parts of the United States

including US Territoriesincluding US Territories To find a supplier, visit To find a supplier, visit http://http://

www.medicare.gov/supplierdirectory/www.medicare.gov/supplierdirectory/search.htmlsearch.html

Medicare Part C & DMedicare Part C & D

Low-Performing Medicare Low-Performing Medicare Advantage and Drug PlansAdvantage and Drug Plans

Plans that receive average Part C or Plans that receive average Part C or D summary rating of less than 3-D summary rating of less than 3-stars for 3 years in a rowstars for 3 years in a row– Indicates organization’s substantial Indicates organization’s substantial

failure to comply with its Medicare failure to comply with its Medicare contractcontract

Ratings are on Medicare Plan Finder Ratings are on Medicare Plan Finder ToolTool

Medicare & You does not have full, Medicare & You does not have full, updated ratingsupdated ratings

Low-Performing Medicare Low-Performing Medicare Advantage PlansAdvantage Plans

Changes for low-performing plans in Changes for low-performing plans in 20132013– No online enrollment for low-performing No online enrollment for low-performing

plans plans Must contact plan directly to enrollMust contact plan directly to enroll

– Enrolled beneficiaries may use Special Enrolled beneficiaries may use Special Enrollment Period to move to a higher Enrollment Period to move to a higher quality planquality plan Will receive mailing from CMSWill receive mailing from CMS

CMS has option to terminate low-CMS has option to terminate low-performing contracts starting in performing contracts starting in 20152015

2013 Calendar 2013 Calendar HighlightsHighlights

Late September- CMS mails the Medicare Late September- CMS mails the Medicare & You handbook& You handbook

September 30- Plans must provide September 30- Plans must provide Annual Notice of Change/Evidence of Annual Notice of Change/Evidence of Coverage to membersCoverage to members

October 1- Plans begin marketingOctober 1- Plans begin marketing October 1- 2014 plan data to be October 1- 2014 plan data to be

displayed on the Medicare Plan Finderdisplayed on the Medicare Plan Finder Mid-October- plan ratings updated on Mid-October- plan ratings updated on

MPFMPF October 15-Open Enrollment beingsOctober 15-Open Enrollment beings December 7- Open Enrollment endsDecember 7- Open Enrollment ends January 1- 2014 plan benefit period January 1- 2014 plan benefit period

beginsbegins

Standard Part D Standard Part D Benefit ParametersBenefit Parameters

Benefit ParametersBenefit Parameters 20132013 20142014

DeductibleDeductible $325$325 $310$310

Initial Coverage LimitInitial Coverage Limit $2970$2970 $2850$2850

Out-of-Pocket ThresholdOut-of-Pocket Threshold $4750$4750 $3605$3605

Total Covered Drug Spending at OOP Total Covered Drug Spending at OOP ThresholdThreshold

$6954.52$6954.52 $6455$6455

Minimum Cost Sharing in Catastrophic Minimum Cost Sharing in Catastrophic CoverageCoverage

$2.65/$6.60$2.65/$6.60 $2.55/$6.35$2.55/$6.35

Extra Help CopaymentsExtra Help Copayments 20132013 20142014

InstitutionalizedInstitutionalized $0$0 $0$0

Receiving Home & Community Based Receiving Home & Community Based Ser.Ser.

$0$0 $0$0

Up to or at 100% FPLUp to or at 100% FPL $1.15/$3.50$1.15/$3.50 $1.20/$3.60$1.20/$3.60

Full Extra HelpFull Extra Help $2.65/$6.60$2.65/$6.60 $2.55/$6.35$2.55/$6.35

Partial Extra Help (deductible/cost-Partial Extra Help (deductible/cost-sharing)sharing)

$66/15%$66/15% $63/15%$63/15%

Part D Coverage Gap Part D Coverage Gap Discount ProgramDiscount Program

If beneficiaries reach the coverage gap If beneficiaries reach the coverage gap in 2013in 2013– 52.5% discount on covered brand-name 52.5% discount on covered brand-name

drugsdrugs Counts toward TrOOPCounts toward TrOOP

– 21% discount on covered generic drugs21% discount on covered generic drugs– Total cost paid by beneficiary (plus the Total cost paid by beneficiary (plus the

52.5% discount) counts toward catastrophic 52.5% discount) counts toward catastrophic coveragecoverage

– Dispensing fees are not subject to the Dispensing fees are not subject to the 52.5% discount52.5% discount

Additional savings in coverage gap each Additional savings in coverage gap each year year – Until 2020Until 2020

Improved Coverage in the Improved Coverage in the Coverage GapCoverage Gap

YearYear

What Beneficiaries Pay What Beneficiaries Pay for Brand Name Drugs in for Brand Name Drugs in

the Coverage Gapthe Coverage Gap

What Beneficiaries Pay What Beneficiaries Pay for Generic Drugs in the for Generic Drugs in the

Coverage GapCoverage Gap

20132013 47.5%47.5% 79%79%

20142014 47.5%47.5% 72%72%

20152015 45%45% 65%65%

20162016 45%45% 58%58%

20172017 40%40% 51%51%

20182018 35%35% 44%44%

20192019 30%30% 37%37%

20202020 25%25% 25%25%

High Performing Medicare High Performing Medicare Drug PlansDrug Plans

5 Star Special Enrollment Period5 Star Special Enrollment Period– Plans rated 5 Stars are indicated with a Plans rated 5 Stars are indicated with a

yellow triangle with a star and the yellow triangle with a star and the number 5 located in the centernumber 5 located in the center

– SEP begins December 8 each yearSEP begins December 8 each year– Beneficiaries can enroll into a 5 Star Beneficiaries can enroll into a 5 Star

rated plan up until Nov. 30 of the rated plan up until Nov. 30 of the following yearfollowing year

– Only allowed one enrollment during the Only allowed one enrollment during the SEPSEP

– SEP is extended to individuals currently SEP is extended to individuals currently enrolled into a 5 Star planenrolled into a 5 Star plan

Notices from CMS and Notices from CMS and SSASSA SeptemberSeptember

– Social Security Notice to Review Eligibility Social Security Notice to Review Eligibility for LISfor LIS

– Plan Annual Notice of Change/Evidence of Plan Annual Notice of Change/Evidence of CoverageCoverage

– Plan LIS Rider-from plan telling how much Plan LIS Rider-from plan telling how much they get in 2014 towards Part D they get in 2014 towards Part D premium, deductibles and co-paymentspremium, deductibles and co-payments

– Creditable Coverage letters from Creditable Coverage letters from Employer/Union plansEmployer/Union plans

– Loss of Deemed Status Notice-from SSA Loss of Deemed Status Notice-from SSA stating they are no longer eligible for LISstating they are no longer eligible for LIS

– Medicare & You handbooksMedicare & You handbooks

Notices from CMS and Notices from CMS and SSASSA OctoberOctober

– Plan Non-Renewal NoticesPlan Non-Renewal Notices– Change in Extra Help Co-Payment Notice- Change in Extra Help Co-Payment Notice-

from SSA on orange paper explaining from SSA on orange paper explaining copayments levels will change in 2014copayments levels will change in 2014

– Reassignment Notices-Plan Termination-Reassignment Notices-Plan Termination-on blue paper explaining that plan is on blue paper explaining that plan is terminating and they will be reassigned to terminating and they will be reassigned to a new plana new plan

– Reassignment Notice-Premium Increase-Reassignment Notice-Premium Increase-on blue paper explaining that will be re-on blue paper explaining that will be re-assigned to a new plan due to the assigned to a new plan due to the increase in their current plan premium increase in their current plan premium which is above the benchmarkwhich is above the benchmark

Notices from CMS and Notices from CMS and SSASSA OctoberOctober

– MA Reassignment Notice-on blue paper MA Reassignment Notice-on blue paper explaining that the MA plan is terminating explaining that the MA plan is terminating and they will be re-assigned to a Medicare and they will be re-assigned to a Medicare drug plan for 2014drug plan for 2014

NovemberNovember– LIS Choosers Notice-on tan paper LIS Choosers Notice-on tan paper

explaining if they chose a Plan on their explaining if they chose a Plan on their own that the plan’s premium has own that the plan’s premium has increased above the benchmark and they increased above the benchmark and they will pay a portion of the premiumwill pay a portion of the premium

Notices from CMS and Notices from CMS and SSASSA

NovemberNovember– Non-Renewal Reminder Notice- reminds Non-Renewal Reminder Notice- reminds

people who do not get LIS that the plan is people who do not get LIS that the plan is terminatingterminating

– Social Security Income Related Adjustment Social Security Income Related Adjustment Amount Notice- tell higher income Amount Notice- tell higher income beneficiaries about the higher Part B and beneficiaries about the higher Part B and Part D premium adjustmentsPart D premium adjustments

– Social Security LIS Redetermination Social Security LIS Redetermination Decision Notice-informing beneficiaries of Decision Notice-informing beneficiaries of their LIS award for 2014their LIS award for 2014

– Social Security LIS and MSP Outreach Social Security LIS and MSP Outreach Notice-informs individuals of these two Notice-informs individuals of these two benefitsbenefits

Notices from CMS and Notices from CMS and SSASSA

DecemberDecember– Social Security Benefit Rate Change Notice- tells people Social Security Benefit Rate Change Notice- tells people

about benefit payment changes due to cost of living about benefit payment changes due to cost of living increases, premium withholdings, etc.increases, premium withholdings, etc.

– Reassign Formulary Notice- on blue paper informing Reassign Formulary Notice- on blue paper informing individuals who get LIS and were affected by reassignment individuals who get LIS and were affected by reassignment which of the Part D drugs they took in 2013 will be which of the Part D drugs they took in 2013 will be covered in their new 2014 Medicare plancovered in their new 2014 Medicare plan

JanuaryJanuary– CMS Non-Renewal Action Notice- reminds people who do CMS Non-Renewal Action Notice- reminds people who do

not get LIS and whose plan terminated to join a new drug not get LIS and whose plan terminated to join a new drug planplan

FebruaryFebruary– Consistent Poor Performer Notice- Informs people that Consistent Poor Performer Notice- Informs people that

they’re enrolled in a plan that has been identified as a they’re enrolled in a plan that has been identified as a consistent poor performer and encourages them to consistent poor performer and encourages them to explore other plan options in their areaexplore other plan options in their area

THINGS TO REMEMBERTHINGS TO REMEMBER

Medicare Open Enrollment begins October Medicare Open Enrollment begins October 15 and ends December 715 and ends December 7

Must compare your prescription drug Must compare your prescription drug and/or Medicare Advantage planand/or Medicare Advantage plan

Kynect, Kentucky’s health care Kynect, Kentucky’s health care marketplace is for uninsured individuals marketplace is for uninsured individuals and enrollment dates are different from and enrollment dates are different from Medicare Open EnrollmentMedicare Open Enrollment

Review all information received from Review all information received from Social Security or MedicareSocial Security or Medicare