Academic journal article Generations

Medicare Coverage, Affordability, and Access

Academic journal article Generations

Medicare Coverage, Affordability, and Access

Article excerpt

For fifty years, Medicare has been a bedrock of economic and health security for older Americans, providing access to essential medical benefits that address many acute, chronic, and preventive health service needs. Prior to its enactment in 1965, only slightly more than half of all older adults had insurance to help pay for hospital care (Gornick et al., 1996). Many were unable to obtain health insurance either because they could not afford the premiums or because they were denied coverage based on age or preexisting health conditions. Because of Medicare, millions of older Americans and people with disabilities no longer have to worry about being uninsured for their medical care needs.

In important ways, however, Medicare coverage is not comprehensive, and, due in part to Medicare's premiums, deductibles, and costsharing requirements, paying for Medicare and Medicare-covered services can represent a financial challenge, particularly for people with low and moderate incomes. The combination of coverage gaps and affordability concerns can lead to access problems that some on Medicare struggle to overcome.

This article will review the state of Medicare coverage, affordability, and access, examine ways in which Medicare falls short, and discuss the implications. Findings are based upon previously published research and new analysis of the Medicare Current Beneficiary Survey 2012 Access to Care file, a nationally representative survey of Medicare beneficiaries conducted by the Centers for Medicare & Medicaid Services (CMS) (Centers for Medicare & Medicaid Services, n.d.).

Overview of Medicare Coverage

Medicare benefits are covered under three parts-Part A, Part B, and Part D-and beneficiaries can access Medicare benefits through two programs-traditional Medicare and Medicare Advantage. Part A benefits include inpatient care provided in hospitals, short-term stays in skilled nursing facilities, hospice care, and post-acute home healthcare. Part B benefits include outpatient services, including outpatient hospital care, physician visits, and preventive services (such as mammography and colorectal screening). Other Part B outpatient benefits include laboratory services and diagnostic tests, durable medical equipment (such as wheelchairs and oxygen), outpatient mental health care, and some home health visits. Part D covers a voluntary outpatient prescription drug benefit delivered through private plans that contract with Medicare, including stand-alone prescription drug plans (PDP) or Medicare Advantage drug plans.

Beneficiaries can access parts A and B benefits through the traditional Medicare program, which pays for care delivered by medical providers such as doctors and hospitals on a fee-for-service basis, and can enroll in a standalone Part D plan for drug coverage. As an alternative to traditional Medicare, beneficiaries can enroll in a private Medicare Advantage plan, such as a health maintenance organization (HMO) or preferred provider organization (PPO), for all Medicare-covered Part A and Part B benefits, and, typically, Part D benefits. Enrollment in Medicare Advantage plans has grown over time, with nearly 16 million beneficiaries (30 percent of all beneficiaries) in a Medicare Advantage plan in 2014 (Jacobson et al., 2014).

While benefits covered by Medicare are the same for enrollees in traditional Medicare and Medicare Advantage plans, issues related to gaps in coverage, affordability, and provider access are different for these populations, and are discussed separately below.

Gaps in Medicare Coverage

Traditional Medicare does not cover some services that could greatly benefit many older adults and people with permanent disabilities, including long-term services and supports (LTSS), dental services, eyeglasses, and hearing aids. Beneficiaries in Medicare who need these services must pay the full cost out of their own pockets unless they have other sources of coverage. …

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