For Older Adults and Persons with Special Needs

When history was made on March 23, 2010, President Obama signed a comprehensive health care reform bill (H.R. 3590) into law.  Then on March 25th, Congress passed the Reconciliation Act of 2010 (H.R. 4872) which modifies H.R. 3590.  Taken together, these two bills comprise the health care reform package.  Important provisions for older adults and people with special needs include:

Medicare

• Provides a $250 rebate to Medicare beneficiaries who reach the Part D coverage gap in 2010 (Effective January 1, 2010).
• Gradually eliminates the Medicare Part D doughnut hole by 2020:
• For brand-name drugs, requires pharmaceutical manufacturers to provide a 50% discount on prescriptions filled in the Medicare Part D coverage gap beginning in 2011, in addition to federal subsidies of 25% of the brand-name drug cost by 2020 (phased in beginning in 2013)
• For generic drugs, provides federal subsidies of 75% of the generic drug cost by 2020 for prescriptions filled in the Medicare Part D coverage gap (phased in beginning in 2011)
  • Provides Medicare coverage, with no co-payment or deductible, of an annual wellness visit and creation of a personalized prevention assessment and plan. Prevention services include referrals to education and preventive counseling or community-based interventions to address risk factors.
  • Eliminates Part D cost-sharing for full-benefit dual eligible beneficiaries receiving home- and community-based services.
  • Restructure payments to Medicare Advantage (MA) plans by setting payments to different percentages of Medicare fee-for-service (FFS) rates, with higher payments for areas with low FFS rates and lower payments (95% of FFS) for areas with high FFS rates. Phase-in revised payments over 3 years beginning in 2011, for plans in most areas.
  • Require the Secretary to suspend MA plan enrollment for 3 years if the medical loss ratio is less than 85% for 2 consecutive years and to terminate the plan contract if the medical loss ratio is less than 85% for 5 consecutive years. (Effective beginning in 2011.)
  • Although the provisions cut MA payments as a whole, there are no provisions for cuts to mandated benefits. As a result of the payment reductions, MA plans may cut extra, optional benefits such as vision and dental. The provisions for equalizing payments between MA plans and traditional Medicare are based on a recommendation by the non-partisan Medicare Payment Advisory Commission (MedPAC), and supported by advocates for Medicare beneficiaries such as the Center for Medicare Advocacy.
  • These and other provisions strengthen Medicare and extend by nine years the life of the Medicare Trust Fund which was projected to be depleted in 2017.
  • Applies the Medicare tax to net investment income for individuals making $200,000 and over and couples making $250,000 and over.

Long-Term Care

• Establishes the Community Living Assistance Services and Supports (CLASS) program, a new national long-term care insurance program funded through voluntary payroll deductions, which will provide a cash benefit to individuals who are unable to perform ADLs for the purchase of community living assistance services and supports. According to the Congressional Budget Office, the CLASS program will reduce the deficit by $70 billion over 10 years due to the payment of premiums by enrollees (the voluntary payroll deductions) in excess of benefits paid out in the first decade, and including federal Medicaid savings.
• Creates the State Balancing Incentive Program (10/1/2011 – 9/30/2015) to provide enhanced federal Medicaid matching to states which currently spend less than 50 percent of total expenditures for long-term care on services in the home or community to increase their proportion of non-institutionally-based long-term care services.

Nursing Home Transparency

• Requires nursing homes to disclose their owners, operators, suppliers, financers, and others with whom they do business so they can be held accountable for the care their residents receive.
• Requires nursing homes to take steps internally to reduce criminal and civil violations;
• Establishes a Quality Assurance and Performance Improvement Program to improve quality assurance standards.
• Requires the government to implement a system to collect and report information about how well nursing homes are staffed, including accurate information about the hours of nursing care residents receive; staff turnover rates; and how much facilities spend on wages and benefits.
• Requires cost reports that nursing homes will file with the government to show expenditures by category — nursing, therapy, capital assets, and administrative services.
• Requires civil monetary penalties (fines) to be held in escrow pending appeals rather than allowing nursing homes to delay payment indefinitely while they file appeals.
• Implements a pilot program to improve federal government oversight of nursing home chains that have quality of care problems.
• Provides training to workers who care for residents with dementia and to prevent abuse.

Elder Justice

H.R. 3590 contains the Elder Justice Act (EJA), which:

• Establishes an Elder Justice Coordinating Council to make recommendations to the Secretary of Health and Human Services on the coordination of activities of federal, state, local and private agencies and entities relating to elder abuse, neglect, and exploitation. Recommendations are due in two years.
• Provides $400 million in first time dedicated funding for Adult Protective Services (APS).
• Provides $100 million for state demonstration grants to test a variety of methods to detect and prevent elder abuse.
• Provides $26 million for the establishment and support of Elder Abuse, Neglect and Exploitation Forensic Centers to develop forensic expertise and provide services relating to elder abuse, neglect, and exploitation.
• Provides $ 32.5 million in grants to support the Long-Term Care Ombudsman Program and an additional $40 million in training programs for national organizations and state long-term care ombudsman programs.
• Authorizes $67.5 million in grants to enhance long-term care staffing through training and recruitment and incentives for individuals seeking or maintaining employment in long-term care, either in a facility or a community based long-term care entity.

This information was summarized from various sources by Brian Lindberg and Gail MacInnes. gmacinnes@consumers.org. For more great information on how the health care reform affects seniors, please go to NAELA’s site (National Academy for Elder Law Attorneys, Inc.) http://www.naela.org/ViewFullArticle.aspx?ArticleID=477 For more information on how these new provisions affect you right now, please call the California Elder Law Center today at 562-627-9600.