The most recent resolution to fund the federal government included a number of positive adjustments to Medicare programs and activities that expired or were due to expire.
Many of these adjustments are victories for Medicare enrollees and the agents who serve them. Here’s a review of Medicare’s wins in the government’s most recent budget deal.
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Part D “Donut Hole” to Close by 2019
The Part D coverage gap – which requires beneficiaries to pay the full cost of their medications for a period – was already on track to close by 2020 thanks to the Affordable Care Act (ACA). The Bipartisan Budget Act of 2018 speeds up this process by a year. In 2019, beneficiaries who fall into the coverage gap will only pay 25 percent of the cost of their prescription drugs until they reach their annual out-of-pocket limit.
Additionally, the resolution increases the percentage that a drug manufacturer must discount the cost of prescriptions. As a result, drug manufacturers will now pick up more of beneficiaries’ out-of-pocket costs.
By closing the gap a year early, the government expects to save money since beneficiaries will now take longer to reach their annual out-of-pocket spending limit.
Repealed Caps on Rehab
The budget deal permanently repeals annual per-beneficiary limits on outpatient therapy services, a huge relief for stroke patients and people recovering from major surgeries. Effective immediately, services including physical therapy, occupational therapy, and speech therapy are no longer subject to the old caps.
The Congressional Budget Office (CBO) estimates this repeal will increase spending by $6.5 billion over 10 years.
Special Needs Plans Permanently Extended
Before the budget deal, the contract for Medicare’s Special Needs Plans Program was set to expire December 31, 2018. The latest act permanently reauthorizes the program which provides services for individuals who are institutionalized; dual-eligible for Medicare and Medicaid; or living with severe chronic conditions.
The act requires “the Health and Human Services Department (HHS) to provide a dedicated point of contact for states to address misalignments in the integration of specialized Medicare Advantage plans for individuals with dual eligibility, and to establish a unified appeals and grievance process.”
There are about 2.3 million Americans in SNPs. The CBO estimates the SNP program extension would increase spending by $125 million over the next 10 years.
In a huge victory for the Medicare beneficiary, the budget deal vastly expands Medicare’s ability to pay for telemedicine care. This is good news for those with end-stage renal disease (ESRD) who are receiving at-home dialysis, as well as individuals suffering from stroke symptoms.
According to an analysis from the National Association of Health Underwriters (NAHU), the deal “eliminates the geographic restriction in all areas of the country to permit payment to a physician providing the telehealth consultation for the purposes of diagnosis, evaluation, or treatment of symptoms of an acute stroke.”
Other Changes to Medicare
Increases Medicare Part B & D Premiums for the Wealthiest Beneficiaries
There are currently five income brackets that determine the premiums individuals or couples pay for their Part B and D premiums. For 2019, the budget agreement adds a sixth, higher income bracket. Now, individuals with $500,000 in income or married couples earning $750,000 and filing taxes jointly will be responsible for 85 percent of their Medicare Part B and D premiums.
Individuals in the current highest bracket ($160,000 individuals, $320,000 for married couples who file taxes jointly) are responsible for 80 percent of their premium costs.
Cost-Control Board Repealed
The Affordable Care Act authorized a 15-member cost-control board called the Independent Payment Advisory Board (IPAB) to make recommendations to Congress regarding options for controlling Medicare costs. However, neither the Obama nor Trump administrations have appointed people to the posts.
The budget deal repeals the provision authorizing IPAB. It also restores a previous law that requires the independent Medicare Payment Advisory Commission (MedPAC) to make non-binding recommendations on how to save the program money.
Other Health Coverage Extensions
The agreement also authorizes the Children’s Health Insurance Program for an additional four years, through FY 2027.