Despite Debate on Medicare, Studies Show Affordable Health Care Act Benefits Seniors

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With the debate on Medicare taking central stage in the Presidential election this year, the  U.S. Department of Commerce reports that there are roughly 40 million people 65 and older in the United States.  This age group accounts for  roughly 13 percent of the total population. Between 2008 and 2009, this age group increased by 770,699 people.
Source: Population estimates.

Despite the controversy over the positions held by both presidential candidates, a new study from the Centers for Medicare and Medicare Services (CMS) says  the Affordable Care Act has been a boon to Medicare beneficiaries, saving them more than $3.9 billion on prescription drugs.

New data from CMS shows that more than 5.2 million older Americans and people with disabilities have benefited from the savings since the law went into effect March 23, 2010. More than 1 million people in the "doughnut hole" coverage gap have saved an average of $629 this year alone.

The health care law is helping seniors who are fighting to keep up with skyrocketing health care costs, says AARP Executive Vice President Nancy LeaMond, the leading lobbying group for seniors. "These real savings for older Americans struggling with the ever-rising costs of prescription drugs are evidence that the Affordable Care Act is already improving the lives of millions of Americans," she says.

The saving opportunities have been rolled out in phases:

  • In 2010, individuals who hit the doughnut hole received a one-time $250 rebate.
  • In 2011, they began receiving a 50 percent discount on covered brand-name drugs and 7 percent coverage of generic drugs in the doughnut hole.
  • In 2012, coverage for generic drugs in the gap doubled to 14 percent.
  • In 2020, the doughnut hole will be closed.

In addition, the debate over expansion of Medicare in the states received some clarification recently, when Harvard researchers found expanded Medicare in the last decade to cover low income adults had many benefits. Critics of Medicaid expansion contend the program does not improve the health of beneficiaries and may even be linked to worse health, while costing state governments significant funding.

According to a release from AARP, Harvard researchers analyzed data from three states–New York, Maine and Arizona–that had expanded Medicaid in the last decade to cover low-income adults without children or disabilities. In these states, deaths among adults 20-64 decreased by about 1,500 combined per year, after adjusting for population growth. In four neighboring states that did not expand coverage, death rates increased during the same time period.

The researchers concluded that overall, Medicaid expansions were associated with a 6.1 percent decline in deaths.

This study “should raise concern about the failure to expand Medicaid coverage to people most at risk of not getting the care that they need,” said Karen Davis, president of the nonpartisan research foundation Commonwealth Fund.

Under the Affordable Care Act of 2010, states were originally required to expand their Medicaid programs, to the tune of an additional 17 million recipients nationally.

By the year 2050, it is expected that the U.S will have 88.5 million seniors  comprising 20 percent of the total population.
Source: Population projections.

The percentage of the 65 and older population expected to be a minority - i.e., a group other than single race, non-Hispanic white - in 2050 will be 42 percent, more than double the percentage in 2010 (20 percent). Likewise, among those 85 and older, 33 percent are projected to be a minority in 2050, up from 15 percent in 2010. (The figures for 2010 are not census counts.)

Source: The Next Four Decades: The Older Population in the United States: 2010 to 2050. Aging Boomers Will Increase Dependency Ratio, Census Bureau Projects (press release)

 

Signing the Medicare BillPresident Johnson signing the Medicare amendment. Former President Harry S. Truman (seated) and his wife, Bess, are on the far right.

“At over 76 million people, baby boomers represent the largest single population growth in US history and have had an enormous impact on every institution in the country, as well as lived through some of the most interesting times in American history,” begins a recent report by AARP “Approaching 65: A Survey of Baby Boomers Turning 65 Years Old.”

In 1965, Congress created Medicare under Title XVIII of the Social Security Act to provide health insurance to people age 65 and older, regardless of income or medical history. Before Medicare's creation, only half of older adults had health insurance, with coverage often unavailable or unaffordable to the other half. Older adults had half as much income as younger people and paid nearly three times as much for health insurance.

In 1972, Congress expanded Medicare eligibility to younger people who have permanent disabilities and receive Social Security Disability Insurance (SSDI) payments and those who have end-stage renal disease (ESRD). Congress further expanded Medicare in 2001 to cover younger people with amyotrophic lateral sclerosis (ALS, or Lou Gehrig’s disease). Initially Medicare consisted exclusively of Part A, which covers hospital and other inpatient services, and Part B, which covers outpatient care, physician visits, and other “medically necessary services.” Congress then added Medicare Part C (originally called Medicare+Choice, then later changed to Medicare Advantage), which allows enrollees to receive their Medicare benefits through a private plan, under the Balanced Budget Act of 1997, while Medicare Part D was created under the Medicare Modernization Act of 2003.

The Medicare population differs in significant ways from the general population. Compared to the rest of Americans, Medicare enrollees are disproportionately white and female (due to women’s greater longevity). They also have a comparatively precarious economic situation:

Medicare enrollees also have substantial health care needs compared to the general population.

  • A substantial majority of Medicare enrollees – roughly 87% have at least one chronic condition, and nearly half have three or more, compared to 21% and 7% of the general population, respectively. 47% of Medicare enrollees have some kind of activity limitation.
  • 30% of enrollees visit the emergency room in a given year, 21% have an inpatient stay.
  • Roughly two-thirds of seniors require some form of long-term care over their lifetimes, and 18% are enrolled in a nursing home for at least a year.
  • Medicare enrollees also have high incidence of cognitive impairment (31%),[ and on average, seniors have lower health literacy than other age groups (29% have below basic health literacy, while among all other age groups, no more than 13% have below basic literacy). This means that nearly a third of seniors lack the basic skills needed to “obtain, process, and understand basic health information and services needed to make appropriate health decisions.”

 

From the U.S Government:

Senior Citizens' Resources

Find government resources for seniors on money, housing, health, consumer protection, and more.

Caregivers' Resources
Help providing care, benefits, long-distance caregiving, legal matters, support for caregivers...

Consumer Protection for Seniors
Consumer fraud, elder rights, advocates for nursing home residents...

Education, Jobs, and Volunteerism for Seniors
Adult education, AARP working options, Senior Corps...

End-of-Life Issues
Advance directives, estate planning, hospice...

Federal and State Agencies for Seniors
Administration on Aging, Social Security Administration, Veterans' Health Administration...

Grandparents Raising Grandchildren
Find grandparent programs in your state and get information about benefits, assistance, and more.

Health for Seniors
Disease, health care facilities, Medicare, nutrition...

Housing for Seniors
Reverse mortgages, in-home help, nursing home comparison, and more...

Laws and Regulations Concerning Seniors
Age Discrimination in Employment Act, Medicare Modernization Act, Social Security Act...

Money and Taxes for Seniors
Investing, tax counseling, estate planning...

Retirement
Pension plans, benefits calculator, retirement ages...

Travel and Recreation for Seniors
Amtrak senior discount, older drivers, travel tips...

 

Visit your local library for more resources on seniors and living well while  retired.

 

 

 

Image credits:

1. Article illustration:Alice Lewis by Rain Moth Gallery

2. President Johnson signing the Medicare amendment. Former President Harry S. Truman (seated) and his wife, Bess, are on the far right.

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