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December 07, 2011 12:25 PM ACA delivers big savings for seniors

By Steve Benen

Most of the Affordable Care Act won’t take effect for a few years — and if court rulings and the 2012 elections go a certain way, it may not take effect at all — but there’s already evidence that the reform law is working.

It’s making a big difference in providing coverage for young adults; it’s providing treatment options for women like Spike Dolomite Ward; and it’s slowing the growth in Medicare spending.

It’s also, as Jonathan Cohn explained, saving seniors quite a bit of money on prescription medication.

Under the terms of the Affordable Care Act — yes, Obamacare — pharmaceutical companies provide a 50 percent discount on name-brand drugs for seniors who hit the “donut hole.” The donut hole is the gap in coverage that begins once an individual Medicare beneficiary has purchased $2,840 in drugs over the course of a year. At that point, the beneficiary becomes completely responsible for prescription costs — in other words, he or she has to pay for them out of his pocket — until he or she has spent another $3,600.

It may not sound like a lot of money. But the seniors who hit the donut hole are, by definition, the ones with the most medical problems. Saving a few hundred dollars, on average, makes a real difference. And that’s precisely what’s happening, according to data the administration released today. According to its calculations, 2.65 million seniors hit the donut hole — and then saved an average of $569 each. The data runs through October. More seniors will hit the donut hole through year’s end, so the total number of beneficiaries who take advantage of the discount in 2012 should end up higher.

In an interview with USA Today, Jonathan Blum, director of the Center for Medicare, added, “We’re very pleased with the numbers. We found the Part D premiums have also stayed constant, despite predictions that they would go up in 2012.”

Seniors have been some of the biggest skeptics of the Affordable Care Act, but they’ve also seen some of the most direct benefits. Indeed, USAT’s report went on to note that as of the end of November, “more than 24 million people, or about half of those with traditional Medicare, have gone in for a free annual physical or other screening exam since the rules changed this year because of the health care law.”

If Republicans repeal the law, all of these benefits will simply disappear. It’s something voters may want to keep in mind.

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.

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  • June on December 07, 2011 12:32 PM:

    Awesome results - but how to get the word out to seniors - like those in Florida who couldn't wait to vote for a white collar criminal who ripped off Medicare, then used those ill-gotten gains to bamboozle seniors into voting for him?

  • blackwaterdog on December 07, 2011 12:58 PM:

    How would they keep it in mind, if they don't even know about it? Just like that woman who apologized to Obama yesterday didn't know. The media is so screwed and so dirty, they lie through their breath to help Republicans. It's so depressing.

  • victory on December 07, 2011 2:00 PM:

    Little confused on how the donut hole works and the 50% off.

    The donut hole is $3600. Did the ACA lower the hole to this amount from a higher amount? If it did, then, I get it. End of discussion

    But, if the size of the hole remained the same, what's it matter that the drugs are discounted 50%. Regardless of the discount, the same amount of $3600 still needs to be paid out of pocket before seniors are on the other side of the hole.

    Does this mean that seniors will be able to get through the year with out paying a full $3600 and not have to see the other side?

  • JKO on December 07, 2011 2:11 PM:

    "They call it Obamacare, that's right, I DO care! The question is why don't you care?!" -Pres Obama

    As Mrs. Ward alluded to in her op-ed, every time the Pubs say Obamacare, we should say ObamaCares.

  • exlibra on December 07, 2011 2:30 PM:

    Regardless of the discount, the same amount of $3600 still needs to be paid out of pocket before seniors are on the other side of the hole. -- victory, @2:00PM

    The way I understand it (though I'm not sure), the hole may still be the same $3.6K but, at the 50% discount, you'd be getting twice as many meds as you would have otherwise. So, some people may never reach the end of the hole. But some were never reaching the end of the hole anyway, except through different means -- they were not filling out the prescriptions the way the doctors ordered; they were "stretching" the meds. I know that, for example, my husband was supposed to use an inhaler 4 times a day, but was using it only twice a day, because he felt it was too expensive to use properly. But, of course, if you use only half of the prescribed dosage, quite often you only get half the results. Indeed, he was stretching the meds even before reaching the hole, fearful of reaching it at all. Now, some of those fears have eased.

  • peggy on December 07, 2011 2:33 PM:

    @victory
    Say the senior only needs $3240 worth of drugs that year ($270/mo). Medicare D pays $2840, leaving them $400 in the donut hole.

    Obamacare cuts the cost 50%, saving them $200. In other words, most Medicare recipients, unless they are gravely ill will not need more than $6440 worth of medications.

  • Swift Loris on December 07, 2011 7:51 PM:

    Does this mean that seniors will be able to get through the year with out paying a full $3600 and not have to see the other side?

    Yes. I have a chronic condition that requires an expensive proprietary maintenance medication to keep it in remission. The medication has put me in the doughnut hole to the tune of around $1,500 every year until this one, when I had to pay only around $900 for a prescription that will last me into next year. (Fortunately that's my only medication expense at this point.)

  • Sammy on December 07, 2011 11:36 PM:

    Seniors who are some of the biggest skeptics of the Affordable Care Act are seniors who stop using their brains once they passed the age of 50 years. Or they watch Fox noise and listen the the right-wing nutjobs like Sean, Rush and Glen.

    And they certainly can't depend on many the excuses for media and journalist to give them correct info.

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