Fact Sheet: The Health Care Law and Medicare

by: Education & Outreach, from: AARP, Updated July 2012

The health care law strengthens Medicare by protecting and improving your guaranteed benefits and cracking down on waste, fraud and inefficiency. It also identifies savings that will keep Medicare financially stable for 12 years longer than if the law hadn't been passed.

The Health Law and You

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Through educational fact sheets, live webinars, and the question-and-answer series "Health Care Reform Explained," AARP has the information you need.

The law protects any cuts to Medicare's guaranteed benefits, which include doctor, hospital and rehabilitation services. This is true whether you have Original Medicare or a Medicare Advantage plan.

New Medicare benefits

The health care law gradually closes the prescription drug "doughnut hole," adds free preventive benefits and helps improve access to primary care doctors.

Closes the doughnut hole: If you have prescription drug coverage under Medicare Part D and fall into the coverage gap, or doughnut hole, your out-of-pocket drug costs will be greatly reduced in the future.

If you reach the doughnut hole in 2012, you'll get a 50 percent discount on brand-name drugs and a 14 percent discount on generic prescription drugs while you are in the coverage gap.
The doughnut hole will gradually narrow until it disappears in 2020. However, everyone on Medicare Part D will still have out-of-pocket costs for premiums and co-payments, just like you do today before reaching the doughnut hole.

Two Medicare Plans

Original Medicare: Also called Traditional Medicare or Guaranteed Medicare, is a fee-for-service health plan. You can go to any doctor or hospital that accepts Medicare.

Medicare Advantage: As an alternative to Original Medicare, Medicare Advantage plans are offered by private insurance companies. These plans feature the same health care services as Original Medicare, but many pay for additional services that aren’t covered by Original Medicare. Examples of Medicare Advantage plans include Health Maintenance Organizations (HMOs) or Preferred Provider Organizations (PPOs).

Adds preventive care benefits: You will no longer have to pay for Medicare-approved preventive care services. You will also be able to work with your doctor on a personalized prevention plan to keep you as healthy as possible. This means that health problems can be detected sooner and treated more quickly. The preventive benefits include:

A yearly wellness visit
Screenings for diabetes and certain cancers. (Such procedures include mammograms, colonoscopies and other preventive screenings.)

Improved access to primary care doctors: You want to be sure you'll continue to receive quality care. You also want primary care providers to be available to give you that care. The law addresses these needs.

Primary care doctors and nurses who treat people with Medicare will get bonus payments for providing quality care.
Medicare will give extra payments to physicians and nurses who provide primary care in areas with doctor shortages.

Cracks down on waste, fraud and inefficiency: Like many people on Medicare, you are probably concerned about health care fraud. Scams and fraud take money from the Medicare program.

The law provides new resources to fight fraud and abuse in Medicare.
It puts in place more tools to catch those who fraudulently bill Medicare in order to keep them out of the program.