How Health Care Reform Makes Medicare Stronger
We all realize Medicare needs help. Without intervention, Medicare could face insolvency within the next decade. The Affordable Care Act, the Health Care Reform legislation approved in March, 2010, aims to increase the strength of the Medicare program, and is expected to extend the solvency of Medicare by at least 12 years beyond the current doomsday projection of 2017.
Why Medicare Needs Reform
At the heart of the matter is Medicare's obligation to provide benefits to a growing number of 'baby boomers' – all while not offsetting these costs by increased taxes. Of course, politics plays a large role in this problem. Neither the Democrats, nor the Republicans wish to be the party that cuts benefits or increases taxes, thereby risking the loss of support from the powerful voting block of 45 million Medicare enrollees.
How Health Care Reform Proposes to Help
To increase the strength of the Medicare program, the Affordable Care Act:
- Invests over 350 million dollars to prevent fraud, abuse and overpayment in Medicare, as well as Medicaid and the Children's Health Insurance Program (CHIP).
- Reduces the payments to Medicare Advantage Plan providers to bring their reimbursements more in line to those with traditional Medicare.
- Mandates that Medicare Advantage providers spend at least 85% of every premium dollar received on health care, rather than administrative costs and profits.
- Provides for free annual wellness checkups and certain screenings to reduce future health care costs.
- Creates a Center for Innovation to come up with new approaches to payment and health care delivery.
- Encourages more coordinated health care to reduce overall costs of delivering services; and
- Adjusts payments for productivity improvements such as rewards for the reduction of hospital-acquired infections and reducing avoidable hospital admissions.
The Center on Medicare and Medicaid Services predicts that the new law will save Medicare $575 billion over the next decade, and it's a savings that's sorely needed for this program to retain solvency.
* You may be able to get extra help to pay for your prescription drug premiums and costs. To see if you qualify for getting extra help, call:
1-800-MEDICARE (1-800-633-4227). TTY/TDD users should call 1-877-486-2048, 24 hours a day/7 days a week;
The Social Security Administration at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY/TDD users should call, 1-800-325-0778; or Your State Medicaid Office