Medicare and the Affordable Care Act

Photo that reads Affordable Healthcare

 The ACA (Affordable Care Act) was implemented starting in 2010 and health plans on the private marketplace, known here as Covered California, were first available in 2014.  There are various implications for people with ACA plans who become eligible for Medicare.

We’ve included some information below and you can also schedule an appointment with a HICAP counselor to discuss your situation. See a list of our Counseling Locations

Note: Most of the information on this page applies to people with individual coverage through the ACA, not employer coverage. The rules for people with employer (SHOP) coverage through the ACA are the same as for anyone with employer coverage.

The Covered California website has a fact sheet about Medicare and the ACA, including information on what to do if you have a Covered California plan and then become eligible for Medicare. Go here to see the fact sheet.

California Health Advocates has a lot of information on this topic on their website: http://www.cahealthadvocates.org/health-care-reform
including the following articles:

Question: I am enrolled in Medicare. Do I need to do anything to comply with the ACA?
Answer: No. As a Medicare enrollee*, you are not required to do anything to comply with the ACA. You do not need to purchase a new health insurance product or obtain a special identification card. As someone enrolled in Medicare, your coverage requirements under the ACA are already met. You will not face a tax penalty for not having another form of insurance other than your Medicare coverage. *As long as you have at least Medicare Part A. If you have Medicare Part B only, the answer is different. See HICAP for more information.

Question: I have an ACA plan and I’m going to be eligible for Medicare soon. Do I need to do anything special?
Answer: Yes. In most cases, you will need to dis-enroll from your Covered California plan and enroll in Medicare within three months of becoming eligible for Medicare. If you fail to do so you may face delays and penalties when you try to get Medicare later as well as possible tax penalties if you were getting subsidies on your Covered California plan. See HICAP or the Covered California fact sheet for more information.

Question: Are Medicare benefits being reduced under the ACA?
Answer: No. In fact, your Medicare coverage has improved as a result of the ACA. Here are some ways how:
   1. Free preventive care services. The ACA now provides Medicare enrollees with access to specific preventive medical services at no out-of-pocket cost. These include flu shots, smoking cessation programs, an annual wellness visit for seniors, and screenings for cancer, diabetes and several other chronic diseases.
   2. The prescription drug donut hole is going away. Medicare beneficiaries in the Part D prescription drug coverage gap (known as the “donut hole”) now receive discounts on their brand-name and generic prescription drugs. These discounts will increase each year until the coverage gap is closed completely in 2020. Learn more about the donut hole here

Question: Will I be eligible for government subsidies under the ACA to help pay for my Medicare premiums or medical bills?
Answer: Not in most cases. Medicare enrollees are generally not eligible for ACA subsidies. There could be an exception if someone pays a premium for Part A because they’re not eligible for free Part A. Otherwise once you’re eligible for Medicare, even if you don’t enroll, you’ll no longer be eligible for subsidies on your ACA plan. Therefore most people should cancel their ACA plan once they start Medicare.

Question: Will Medicare Advantage plans go away as a result of the ACA?
Answer: No. Private Medicare Advantage plans are still be available and in fact are stronger and more numerous than ever in the U.S.

Question: Will Medigap plans still be underwritten?
Answer: The rules governing the underwriting of Medigap plans — also known as Medicare Supplement plans — are not affected by the ACA. If you apply for a Medigap plan during a Medigap open enrollment or guaranteed issue period, you will not be subject to medical underwriting (or potentially charged more based on your medical history). If you apply for Medigap coverage outside one of these periods, you may be subject to medical underwriting.

Question: What about Obamacare?
Answer: “Obamacare” isn’t an official title. The official title of this program is the Affordable Care Act, and the official abbreviation is ACA.

Medicare Rights Center – Health Reform and Medicare
The Medicare Rights Center has published a series of documents defining how the Affordable Care Act will benefit Medicare recipients:

• Get the Facts: Health Reform and Medicare Update: March 2010,
www.medicarerights.org/pdf/Fact-Sheet-Health-Reform-and-Medicare-Final-Package.pdf
• Health Reform and Medicare: A Timeline of Implementation,
www.medicarerights.org/pdf/Health-Reform-Implementation-Timeline.pdf
• Health Reform and Medicare: Closing the Doughnut Hole, http://www.medicarerights.org/pdf/Closing-the-Donut-Hole-Chart.pdf

Other questions about the ACA or want to apply for a  Covered California plan? Call Covered California at 1-800-300-1506 or go to www.coveredca.com/FAQs/.

There is also a 14 page FAQ produced by CMS with many more details about the ACA and Medicare. It is in PDF format and you will need Adobe Acrobat in order to open it. CMS FAQ on ACA and Medicare

Use this link to download Adobe Reader if needed.

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