12 of the 23 Affordable Care Act’s CO-Ops have failed leaving more than half a million consumers scrambling for health insurance. Even though Medicare recipients beat the bullet on nearly a 50% increase in premiums for Part B coverage, those newly enrolling in Medicare in 2016 will see an increase from $104.90 to $121.80 per month. Additionally, Medicare Part A annual deductible that beneficiaries pay when admitted to the hospital will be $1,288.00 in 2016, a small increase from $1,260.00 in 2015.
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Premium increases along with higher out of pocket costs, reductions in benefits and fewer choices of doctors and insurance plans have boomers concerned about their healthcare and financial security in retirement.
Alex Tolbert, CEO & Founder of Bernard Health discussed with me for FOXBusiness.com the following tips to manage and maximize healthcare costs and coverages.
Boomer: With over half of the ACA CO-Ops going under, what do you see happening in the future with these non-profit establishments?
Tolbert: CO-Ops will need to partner more and more closely with the medical providers in their networks. The financial interests of co-ops and medical providers should be aligned, as the co-ops want to survive and the providers want there to be competition among insurers.
Boomer: Should delivery system reforms and lowering hospital readmissions under Medicare be allowed to continue?
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Tolbert: Historically, Medicare simply paid hospitals and physicians for treating patients. There were not payment mechanisms in place to measure whether low-quality care may have contributed to the patient's need for additional treatment.
This is changing. Medicare is instituting guidelines whereby if a patient is re-admitted to the hospital too soon after discharge, the hospital is affected financially. Some argue that this could have unintended consequences, such as causing hospitals not to want to take really sick patients who have a high likelihood of being re-admitted, regardless of how high the quality of care was. That said, efforts to include quality measures in the calculation of Medicare payments to doctors probably makes sense -- even though there will certainly be unintended consequences as it is difficult to build a "perfect" model.
Boomer; With baby boomers focused more on health and wellness than ever before, are there any changes coming up?
Tolbert: Change and innovation is difficult when it comes to Medicare. If there is a place where one would expect to see change first, it would be in the Medicare Advantage arena.
Medicare Advantage plans are run by private insurers who assume liability for paying the claims of the Medicare beneficiaries who sign up. These plans have to be as good as, or better than Original Medicare. They have a little more freedom to innovate than Original Medicare, however. For example, they can have disease management programs and require closer coordination of care among primary care physicians and specialists. They also have the ability to adjust their plan designs to respond to trends such as baby boomers being more focused on health and wellness.
And many have done this. One way is to incorporate Silver Sneakers into the benefits they offer. Silver Sneakers is the nation's leading exercise program for active older adults, and many boomers may find it is included in their benefits. If not, they can make a criteria when they are making their elections during open enrollment.
Boomer: What can be done to assist seniors with high monthly drug expenses under part D coverage?
Tolbert: Two action steps should be completed before all else. The first is to make sure that all of your doctors know what drugs you are taking. Many seniors have prescriptions prescribed by their cardiologist of which their endocrinologist is not aware and vice versa. Review your complete drug list with each of your doctors and confirm that it is appropriate to be taking all of them. While doing this, ask about opportunities to adjust the list to more affordable options. For example, many branded drugs are no more than the combination of two generics in one pill. Once you have done this, compare your list of drugs versus the drug formulary of each Part D plan for which you are eligible.
Boomer: How should a baby boomer that is still working evaluate their group health plan versus Medicare-related options?
Tolbert: This can get complicated quickly, especially for boomers who have spouses who are not turning 65 and are on the boomer's group plan.
Healthcare reform has created more options than ever. If you are the only one with coverage through your employer, you'll want to compare what your employer charges to be on the plan with Part B and Part D premiums. If you have a high quality employer plan with creditable drug coverage that doesn't cost you too much, then you'll likely want to stay on that plan while opting out of Medicare Part B and not taking Part D yet. If your employer plan costs a lot, for either you or your spouse, then you may want to consider dropping it in favor of a Medicare strategy for you and under-65 coverage for your spouse. Concerned that your spouse would be turned down for individual coverage because of pre-existing conditions? You shouldn't be. The ACA changed the rules so that no one can be turned down for health reasons anymore in the under-65 market.
The bottom line is that there are a lot of options. The savings you can generate by getting it right often makes the time, energy and resources spent on getting it right well worth it.