Q+A: How does healthcare overhaul affect Medicare?

Wednesday, June 15, 2011

The doctor radical revision of the House of Representatives approved on Sunday includes about 455 billion U.S. dollars in spending cuts to Medicare and other federal health programs over the next 10 years.

Here are some questions and answers about how reforms will affect the Medicare health program for the elderly.

LAW IS CUT Medicare benefits?

No cuts to traditional Medicare benefits. Most of the spending cuts in Medicare Advantage - a program that uses private companies like Humana and UnitedHealth Group to offer Medicare benefits. Many of these providers offer extra coverage and some of the supplements may be left as they are Medicare Advantage subsidies to buy more in line with the cost of traditional Medicare benefits. Payment rates for Medicare Advantage will be frozen in 2011 and then gradually reduce giving companies time to adapt to changes.

Are there any changes in Medicare benefits in the bill?

Yes, Medicare will begin paying welfare visits and annual reimbursement increase for primary care physicians. Currently, Medicare pays only for a general checkup when someone first enters the program and many analysts believe that the health check-ups help improve the overall health of older people and provide better coordination of care.

The bill also provides for an improved Medicare program for prescription drugs. The current program includes a significant gap in coverage that the law was finally closed. Today people fall into this coverage call drops after a total of $ 2,700 spent on drugs. Coverage begins again after $ 6,154 spent.

In 2010, people who fall into the donut hole will receive a refund of $ 250. In 2011, receive a discount of 50 percent on brand name drugs. For 2020, the donut hole closed, and 75 percent of drug costs will be covered.

HOW TO ACHIEVE THE OTHER MEDICARE SAVINGS?

The legislation aims to secure funding in productivity in the Medicare health system to save money.

Studies have shown large variations in costs in different parts of the country, with little difference in health outcomes. The legislation provides for Medicare to test the payment system that is intended to promote better coordination and efficiency of care and maintain or improve the quality of care.

Lawmakers hope the program will save billions of dollars by avoiding duplication of services and providing better coordination of care for people with chronic diseases. The main objective of these reforms of the delivery system is to reward the quality of care rather than a number of services.

The bill also establishes an independent advisory committee that will pay recommendations on how to save money on Medicare and extend the program's financial solvency.

The bill also provides more money to fight Medicare fraud.

WHAT HAPPENS IN THE MEDICARE PAYROLL TAX?

Most taxpayers do not pay the Medicare tax over payroll. The bill calls for raising the tax to 2.35 percent from the current 1.45 percent for those earning $ 200,000 or more and for couples earning $ 250,000 or more. The legislation also would apply the tax on investment income for high income groups.