How Will ObamaCare Affect Your Retirement Plans?

There is one group of people who will feel the brunt of the doctor shortage due to the current lack of physicians accepting Medicare patients: Baby Boomers.

These shortages happened long before the Affordable Care Act (aka ObamaCare) was enacted.  Under ObamaCare, further reduced reimbursements to physicians for services rendered under ObamaCare will cause a greater shortage of Primary Care Physicians. This is all at the same time the aging population will be seeking more help via Medicare.

Now, under the Affordable Care Act enacted in 2010, the government is scaling back on some of those reimbursements. The healthcare reform law zeroed in immediately on payments made to private insurers who participate in Medicare, explicitly calling for reductions. Now, the insurers are facing the pain of drawing down this subsidy.

Especially cities with a high percentage of seniors per capita, Primary Care Physician shortages are nothing new to many areas of the U.S. It turns out that physicians do not like the standard reimbursements of 35 cents on the dollar that are received from Medicare. Shocking!

Most people knew it was coming; now it’s here and worse than expected. If you go to bed with the government, eventually you get in their way and they will kick you out of bed.  The Center for Medicare/Medicaid Services originally said Medicare Advantage participants would benefit from their proposal by paying lower premiums and deductibles and through more efficient care provided by their insurers.  Seven years after its initial introduction in to the Medicare Marketplace, Medicare Advantage Plans are more expensive with higher co-pays than ever before.  It is no secret that President Obama is not a proponent of having private insurance carriers help manage Medicare Benefits, like Medicare Advantage Plans.

ObamaCare will also impact primary care for the younger population, which will further uncover an existing shortage by making services equally available to those who were previously uninsured.  Remember that with ObamaCare, everyone can be underwritten and has the right to health insurance.  Those in poor health due to bad habits or poor diet are usually lower-income wage earners.  These individuals in particular will have their medical premiums subsidized by Mr. and Mrs. taxpayer, which will further drive up taxes to pay for ObamaCare and/or force a reduction in services provided under ObamaCare.

Ultimately, you are going to have to set aside more savings for healthcare to last through your retirement years than previous generations.  There is hope that there will always be some type of Medicare supplement option available, but make no mistake: Premiums will go up and services will decline as they have in many other countries where healthcare is mandated.

A favorite question I pose to current clients who are Medicare Beneficiaries is: In today's medical climate, would you recommend your grandchild becomes a physician today?