December 31st, 2010
03:37 PM ET
Along with noisemakers, hangovers and second-tier bowl games, the new year rolls in changes to health insurance rules that stand to save Americans – especially those over age 65 – a lot of money in 2011. The Affordable Care Act (ACA) – “Obamacare,” to critics – was signed into law in March but was built to take effect in stages. Several key provisions take effect on Saturday.
The most prominent change will shrink the so-called “doughnut hole.” Up to now, seniors hit the doughnut hole once they and their insurer have purchased $2,800 worth of medications. The next chunk – up to a $4,550 out-of-pocket maximum – cannot be reimbursed by insurance. Under the ACA, the gap will be closed in increments over the next 10 years. It starts Saturday; in 2011 Medicare will pick up half the cost of brand-name medications for patients in the dreaded doughnut hole.
Another 2011 change is a federal requirement that health insurers pay at least 80 percent of the total premiums they collect, on small plans. Plans for large employers, which cover most Americans, will have to pay out at least 85 percent of premiums. Those who don’t will have to offer rebates. Insurers who raise rates more than 10 percent will have to justify the increase to state and federal regulators.Among other changes starting tomorrow:
- Medicare will cover 100 percent of the cost of preventive services, including annual checkups.
- Primary care physicians and general surgeons will receive a 10 percent bonus on payments through Medicare.
- Wealthier Medicare patients will see lower subsidies and the start of higher premiums.
Meanwhile, new insurance cards are arriving for many young adults going on their parents’ policies. One of them is Chris Brooks, 24, in Levittown, Pennsylvania. In 2008 he nearly died when his heart stopped for more than 20 minutes after an unexplained cardiac arrest. While doctors and paramedics saved his life, and doctors later implanted a defibrillator in his chest, Brooks was uninsured and unable to pay for extensive testing that might reveal the cause of his heart problem.
“I’m 23, and I’m not in school any more,” he told CNN’s Dr. Sanjay Gupta at the time. “I can’t see [my cardiologist] without it. I want to, but I can’t.”
Now, he can. The ACA lets people younger than 26 sign up on their parents’ coverage plan. Hundreds of insurers made the change last summer, but the law allows companies to wait until whenever their next enrollment period takes effect – and most insurers, including the Blue Cross Blue Shield company that covers the Brooks family – held off until 2011.
Chris’ mother Joan says she’s optimistic but won’t relax yet “because I want to see the medical card in the mail, first.”
Beyond these details, the ACA faces several major challenges in 2011. Republican lawmakers have vowed to withhold funding or try to repeal various parts of the law. And one federal judge has ruled that its “individual mandate” to purchaser insurance is unconstitutional, even as two other federal judges have upheld the law as written.
Programming note: See the cutting edge medical advances that saved Chris Brooks’ life, when “Another Day: Cheating Death” replays Sunday, January 2, 8 p.m. & 11 p.m. Eastern.
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Get a behind-the-scenes look at the latest stories from CNN Chief Medical Correspondent, Dr. Sanjay Gupta, Senior Medical Correspondent Elizabeth Cohen and the CNN Medical Unit producers. They'll share news and views on health and medical trends - info that will help you take better care of yourself and the people you love.