Minding Ag's Business

Over 65? Turn Off Noise on Obamacare

David and Anne (not their real names) are Nebraska farmers in their 70s, still active in the business. With health coverage under Medicare, a supplemental health insurance policy to cover prescription drugs and other non-Medicare costs, and a long-term care policy if they need a nursing home, they tell me they are spending $18,000 to $19,000 a year for health expenses. Dropping their long-term care insurance would only save $6,000/year. Is there anything in the new health care program for them?

That's a good question, since rural America is graying and already spends a good chunk of their incomes on health care. According the last Census, Nebraska's rural counties are home to two-thirds of the state's elders over 65, even though rural counties represent only 41% of the state's population, according to the Center for Rural Affairs. What's more, the Kaiser Family Foundation estimates that Medicare recipients spend an average of 15% of their incomes on health costs. Without a supplemental policy, seniors will find Medicare offers relatively high deductibles and no ceilings on their share of payments, a frightening thought at any age.

But the short answer is, most of the Obamacare provisions affecting senior citizens were implemented beginning in 2010, according to a new report from the Center for Rural Affairs in Lyons, Neb.

For starters, Medicare fulfills the mandatory insurance requirement starting Jan. 1. Anyone over 65 with Medicare Part A coverage (for inpatient care in skilled nursing facilities, hospitals, hospice care and home health care) fulfills the mandate that all U.S. citizens and legal residents acquire health insurance or face a fine. Those with Medicare are ineligible to purchase supplemental health or dental insurance on the state or federal exchanges, so David and Anne can't shop for better deals there.

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“There has been so much media attention to the difficulties surrounding implementation of the new health insurance marketplaces. Seniors, however, do not have to worry about the ‘issues’ with the exchanges impacting them directly. They can tune out some of that noise and consider the positive benefits that the Affordable Care Act has to offer them,” says Jon Bailey, director of research for the Center for Rural Affairs.

Bailey points out that seniors are beginning to get relief from the "donut hole"--the gap between prescription drug costs and Medicare coverage. Beginning in 2010, ACA provided relief for seniors and will close the "donut hole" by 2020. They already receive an automatic 50% discount on Part-D covered brand name prescription drugs and that deductible will be reduced in 2014.

In 2011, the Affordable Care Act eliminated co-pays and other cost sharing for preventative services such as mammograms.

"Rural seniors should not be apprehensive about the Affordable Care Act," Bailey says. "They do not have to concern themselves with the health insurance marketplaces, the largest and, so far, most complicated piece of the law. And the ACA provisions from which seniors can benefit are becoming systemized in their day-to-day Medicare health care."

To read the Center for Rural Affairs report, go to http://files.cfra.org/…

For a summary of Medicare see http://kff.org/…

Follow me on Twitter@MarciaZTaylor

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