The Affordable Care Act (ACA) is only a year old, and while many of its provisions aren’t effective until 2014, or like the CLASS act have been repealed, fortunately Medicare beneficiaries have already seen some savings. Whether these savings become more significant over time, however, remains to be seen.
The most publicized ACA success is the shrinking Part D doughnut hole. In 2011, Medicare realized $1.5 billion savings in the prescription drug program. The approximate average savings per traditional Medicare beneficiary was $90; for those beneficiaries reaching the doughnut hole, $631. If all goes according to plan these dollar amounts could increase to $710, and $2386, respectively, by 2021. Perhaps the most significant component of the prescription drug section lies in the fact that drug manufacturers are required to offer a 50% discount for drugs that fall into the doughnut hole for Part D beneficiaries. This discount will encourage beneficiaries to continue to use brand name drugs instead of generic substitutes, and at some point, will result in higher prices of non doughnut hole medications.
In addition to prescription drugs, the ACA now provides participants annual screenings for chronic conditions at no cost through Medicare physicians. It is difficult to quantify savings today, though the idea of identifying an illness early can most often reduce treatment costs later.
Republican Presidential candidates would repeal Obamacare, if elected. In the meantime, the Supreme Court will listen to arguments this March to determine whether or not it’s constitutional to force individuals to buy health insurance. Other aspects of Obamacare will be scrutinized. 2012 looks to be a big year in health care.
For additional information, contact Ellen at EAB HealthWorks.