The short answer is, “Yes, there will still be a need for Medicare supplemental insurance for a few reasons.” Although there has been a great deal of hype over how Obamacare “hurts seniors,” in fareness to the law, it does not hurt seniors as much as the politicians say.
Obamacare emphasizes the health insurance for people who are under the age of 65. At the end of the day, Obamacare only affects people on Medicare in a small way.
MEDICARE B - Medicare Part B pays 80% of the Medicare approved bills submitted by doctors and imaging centers. It is up to you to pay the annual deductible that is charged by Medicare each year plus the 20% of the bill that Medicare does not pay.
MEDICARE C (ADVANTAGE) - Medicare C is also known as Medicare Advantage. It is an option for people with Medicare to use private health insurance. Obamacare did not eliminate the Advantage program. It merely froze federal contributions to the program at 2010 levels. The law allows a one time increase of Medicare Advantage funding by the federal government. That option was, ironically, exercised for 2012, an election year.
MEDICARE D (PRESCRIPTION DRUG PLAN) – Parts A & B of Medicare do not pay for prescription medications. Those Medicare beneficiaries who want insurance help with their prescriptions will need to obtain a Medicare D supplement plan. This is the biggest change in the Medicare program that Obamacare made.
There is a hole in the current program. It is commonly called the, “Donut Hole.” After a beneficiary has spent a specified amount of money on prescription drugs, they receive no insurance help until they have paid a specified amount on prescription drugs out of their own pocket. The “specified amounts” are dictated by the Centers for Medicare and Medicaid Services (CMS) each year by rule rather than law.
Once a beneficiary has spent a specified amount for prescription drug during the “Donut Hole,” the insurance will kick-in again.
The only other major change that Obamacare made to Medicare is the addition of annual, preventive check-ups. Previously, Medicare only allowed an individual to have a “Welcome to Medicare” exam during their first year of Medicare eligibility. After that, if they wanted a wellness exam, they must pay for it themselves.
In the end, the final answer to the question, “Will a Medicare supplement still be necessary under Obamacare?” is ”YES!” Obamacare did nothing about the reasons people buy Medigap or Medicare D supplements. Traditional Medicare still does not pay for prescription drugs. Medicare B still has no “Out-Of-Pocket” limits. It only pays 80% of the Medical bills and leaves you stuck with 20% of the liability.
The Insurance Barn offers both Medigap and Medicare D planning. Use the form to the right to contact us.