Is the PPACA killing Granny?

This is the third in a 5 part series on Medicare.  Join "Health on the Horizon" on Facebook!

Artwork by Norman Rockwell

When the PPACA was passed, you heard all kinds of political rhetoric from massive cuts in medicare to “granny killings”.  While “granny killings” were just outright ridiculous, the impact upon medicare is something to take seriously.  After all, with the official retirement of the “baby boomers” in 2011, the rapidly aging population and a reduction of younger workers to support programs like social security and medicare, this was a reasonable concern.  Furthermore according to the Kaiser Family Foundation, Medicare’s Insurance Trust Fund (Medicare Part A) is expected to become insolvent in 10-15 years.  

So what does this mean to Pennsylvanians?  Let’s simplify how the PPACA impacts medicare by categorizing into 3 basic points: (1) Basic Medicare benefits will remain the same but will be improved with the new access to free preventive care and reduction of the “donut hole”, (2) it implements instruments to reduce waste, fraud and abuse, with part of this being (3) a reduction of payments to Medicare Advantage. 

Ah ha!  That was it! That was the language that sparked the political rhetoric to claim that the PPACA was choking our seniors and possibly even killing your grandmother!  

Ok, now back to reality.  In fact, Medicare Advantage is NOT traditional Medicare at all.  It arose out of a private insurance program  that was developed in the 1970’s as an alternative to those eligible for Medicare.  The original intention was for the private sector HMO/PPOs to provide health insurance at a lower cost.  However, over the years they have resulted in the government paying more per enrollee than those on traditional Medicare.  The government has actually been paying 9-13% higher for these plans. 

Regardless, it is still an important concern because 25% of Americans and 38% of Pennsylvanians are on Medicare Advantage.  According to Jean Friday, President for the Pennsylvania Alliance for Retired People, “many retirees in the western part of the state are very anxious about this piece of legislation.  In the 1990’s many retirees lost their health care benefits and resorted to managed care plans for their coverage. Others were given the option to enroll in Medicare Advantage plans when their employer no longer offered traditional Medicare as an option.”

While this shifting of overpayments from Medicare Advantage to traditional Medicare will allow for the closure of the “donut hole”, the free preventive care and assist with the long-term solvency of the Medicare program, this isn’t a consolation to those possessing these plans.  However, with the PPACA, some consumer protections have been strengthened for Medicare Advantage enrollees.  One of the main ones is that like all other large and small group insurance plans, Medicare Advantage is now subject to Medical Loss Ratio.  This will mean that 85% of the consumer’s premium dollars must now be spent on healthcare and not administrative costs, advertising, CEO bonuses and lobbying.  This will also help in curtailing the future solvency of the Medicare Fund.  Furthermore, the PPACA provides bonuses payments to Medicare Advantage plans based on quality ratings and limits the out of pocket costs or no more than $6700 for the consumer.  Current enrollees have the option of switching plans during the open enrollment period.

Ms. Friday concluded that “In 2010 many politicians claimed the Healthcare Law would be bad for seniors, but here we are, two years later, and the facts do not look bad.  Many have seen the benefits of the closing of the “donut hole” and access to preventive care.  The evidence is in, the Healthcare Law has been and will continue to be good for Pennsylvania Seniors.”

An ounce of prevention: Barbara's Story

This is the second in a five part series on Medicare.  Please join "Health on the Horizon" on Facebook!

Barbara Dickman:  Senior from Westmoreland County PA

It is a common saying among public health professionals that in the United States we don’t have “Healthcare”, we have “sickcare”.  In other words, our cultural attitude perceives medical services as the place to go only when we are ill.  This cultural practice changed recently for Barbara, a 74 year old Westmoreland County resident.  

This year Barbara went to see her doctor for an annual physical.  Most of us wouldn’t see this simple action as something too earth shattering, but in reality, Barbara represents the first generation of seniors that can now access annual physicals free of charge.  

Prior to the passage of the Patient Protection and Affordable Care Act, there was a one-time only introductory physical for Medicare patients and then anything after that was subject to a copay and deductible.  As of January 2011, the PPACA began covering annual physicals in full, as well an array of other research proven preventive health measures.

According to the Alliance for Retired People, in 2006, the state of senior’s health practices were pretty bleak.  In their August 2006 issue brief, they stated that approximately half of all medicare beneficiaries were not taking advantage of preventive services available to them--services that if utilized could prevent, postpone the onset of serious illnesses and ultimately control costs.  There are two explanations for this.  One is the cultural belief among a generation that perceives healthcare as primarily a tool to treat illness, not one to prevent it.  The second reason is cost.  Prior to the passage of the PPACA, many of these services required a 20 percent coinsurance and deductible.

    

Let’s look at the stats:  Colon cancer and cervical cancer are among the most preventable forms of cancer.  According to the American Cancer Society, 90% of all colorectal cancers occur in people over the age of 50.  Yet, 31% of seniors received a colonoscopy in 2006.  With that said, in the past 20 years, with advances in screening technology and polyp removal, incidence and deaths from colorectal cancer have drastically decreased.  Likewise, with the advanced technology of the Pap Test (test used to detect cervical cancer), we have seen a 67% decrease in incidence and mortality rates over the past 3 decades.  Yet, only 36% of senior women utilized the pap test/pelvic exam to prevent cervical and vaginal cancer.

Transforming the cultural attitude of seniors to see medical services as “healthcare” instead of “sickcare” may continue to be an obstacle for us.  However, the advances and success in medical technology is showing that our societal attitude is turning the corner.  As of January 2011, our public health policy validated this shift.

Inside the "Doughnut Hole": Barbara's Story

This it the first of a five part series on Medicare.  Join "Health on the Horizon" on Facebook!

Barbara Dickman:  Senior Citizen from Westmoreland County PA

“Doughnut Hole”.  As someone that has spent most of my career in public health, I found this an odd term to use when referring to healthcare.  However, it has become a legitimate term to use when referring to the gap that many seniors on medicare experienced when they max out their basic drug benefits--at which point, they are now in the “doughnut hole”--until catastrophic drug benefits kick in (usually costing them a few thousand dollars).

In 2010 the Department of Health and Human Services estimated that almost 4 million seniors reached the doughnut hole (177,00 in Pennsylvania) and were therefore faced with the financial challenge of meeting 100% of their prescription drug costs at a time when most seniors are on a fixed income.  According to the Pennsylvania Alliance for Retired Americans, as of October 2011, 70% of Pennsylvanians reached the “doughnut hole”.  The public health challenge to this coverage gap is that the DHHS also projected that one quarter of these people stop following the prescribed regimen of drugs once they hit the donut hole.  The personal health implications and healthcare costs that follow go without saying.  

In 2010 when the PPACA was passed, all seniors that reached the doughnut hole received a $250 rebate check and beginning in 2011the doughnut hole began to close and will continue to shrink until 2020.  As a result, in 2011, 3.6 million Americans saved $2.1 billion and Pennsylvania Seniors saved $109 million ($617 for each Pennsylvanian).  

One of these seniors is Barbara Dickman, a retired stockbroker from Westmoreland County, PA.  Barbara suffers from diabetes and congestive heart failure and prior to the passage of the PPACA was paying approximately $14,000 a year out of pocket for medical costs for her and her husband.  After the passage of PPACA she shopped on the government web site where she found a more affordable medicare supplement for her and an HMO for her husband.  Their healthcare costs have decreased by almost $6,000 (most of which comes from the ‘doughnut hole‘ relief).  

¹ US Dept. of Health and Human Services Press Release, February 2, 2012

² PA Alliance for Retired People,  December 22, 2011 Press Release

³ MoscowVillager, February 3, 2012

        

Easter Holiday Weekend Break

March 27, 2012:  PPPACA supporter in front of the Supreme Court

"Health on the Horizon" will be taking the week off for the Easter Holiday Weekend.  In the meantime,  be sure to "Like" it on Facebook and follow on Twitter.

Coming up this spring: A five part series on Medicare, A series called "Questions from the Community", we'll meet the "Healthcare Serf" and many other Pennsylvania neighbors that are benefiting/will benefit from the Patient Protection and Affordable Care Act.  Of course, we continue to wait the Supreme Court's decision due to be released in June or early July.