ACA – Seniors

Health-Care Reform Changes Affecting Seniors

The Patient Protection and Affordable Care Act, enacted in 2010, contains some provisions that directly affect our nation’s elder population. If you’re a retiree or a senior, you may be concerned about how these reforms may affect your access to health care and insurance benefits. The following is an overview of health-care reform legislation provisions you should be aware of.


There are two goals of the health-care legislation:

  1. To slow the increasing cost of Medicare premiums paid by beneficiaries
  2. To ensure that Medicare will not run out of funds.

To help achieve these goals, cuts in Medicare spending will occur over a ten-year period, which began in 2011, particularly targeting Medicare Advantage programs.

If you participate in a Medicare Advantage plan, these cuts could reduce or eliminate some of the extra benefits your plan may offer, such as dental or vision care, and your premiums may increase.

Medicare Advantage plans cannot reduce primary Medicare benefits, nor can they impose deductibles and co-payments that are greater than what is allowed under the traditional Medicare program for comparable benefits.


The legislation also improves some traditional Medicare benefits. Beginning in 2011:

  • Free annual wellness exams
  • Preventive care tests such as screenings for high blood pressure, diabetes, and certain forms of cancer
  • Personalized prevention assessment and plan to address particular health risk factors you may encounter.


  • Beginning in 2013, a reduction in co-payments for brand-name drugs will be phased in.
  • By 2020, a combination of federal subsidies and a reduction in co-payments will reduce your out-of-pocket costs for medications in the gap from 100% to 25%.
  • Individuals with annual incomes greater than $85,000 and couples with incomes exceeding $170,000, will see their Part D premiums increase as the federal subsidy offsetting some of the cost of Medicare Part D premiums is reduced.


You may be between the ages of 55 and 65 and do not have health insurance provided by your employer, or if covered, find that your cost for insurance is substantial. If you’re in this predicament, the health-care legislation provides you with opportunities for affordable health insurance.

By 2014, state-based American Health Benefit Exchanges will be created, through which you can purchase affordable health insurance coverage.

  • The Exchanges will serve as a conduit for health insurance providers to offer health plans with different benefits, co-insurance limits, and premium costs.

You can then compare the costs of various plans and benefits. If you can’t afford an Exchange plan, you may be eligible for a government subsidy based on income and family size.


The health-care reform law provides for programs and incentives for greater access to in-home care.

  • The Community First Choice Option is available for states to add to their Medicaid programs. This option provides benefits to Medicaid-eligible individuals for community-based care instead of placement in a nursing home.
  • State Balancing Incentive Program, running through October 2015, provides increased federal funds to qualifying states that offer Medicaid benefits to disabled individuals seeking long-term care services at home, or in the community, instead of in a nursing home.

These programs must meet state eligibility requirements. Ask your financial advisor about these programs for your area.


The Independence at Home demonstration program, available in 2012, is a test program that provides Medicare beneficiaries with chronic conditions the opportunity to receive primary care services at home. This is intended to reduce costs associated with emergency room visits and hospital readmissions, and generally improve the efficiency of care.

While in-home care may be a preference, often a nursing facility is the better or only alternative. The health-care legislation addresses the need for more transparency regarding nursing facilities. For example, nursing homes are required to disclose their owners, operators, and financers. The government will also collect and report information about how well a particular nursing home is staffed, including the number of hours of nursing care residents receive, staff turnover rates, and how much facilities spend on wages and benefits.