The health care industry officially began a new era when the Supreme Court upheld the much-debated Patient Protection and Affordable Care Act (PPACA) - informally known as “Obamacare.” Is it good? Is it bad? What exactly does it do?
It’s hard to distinguish the partisan gamesmanship from the facts, but the bottom line is that, like every public policy, the act benefits some people and penalizes others. Many points impact availability and coverage of hearing health care options, both directly and indirectly – and getting to the bottom line takes some digging.
At HearPO, we understand that many of our patients and potential patients probably have questions about how “Obamacare” affects their hearing health care. The PPACA is a mammoth piece of legislature, one with many fine details and connected parts. It’s much, much more than the “personal mandate” issue that’s the hot-button topic of many cable news debates. As such, we think that the best way to get a grasp of the PPACA’s impact on the audiology industry is to look at both the micro and macro perspectives.
With that in mind, here are ten key (and non-partisan) facts everyone should know regarding the PPACA - in no particular order and with an emphasis on audiology patients:
Fact 1: Young adults can be covered on their parents’ insurance up to age 26. Perhaps the most publicized PPACA item next to the personal mandate issue, this makes a particularly heavy impact as the economy continues to march towards a full recovery. Post-college jobs still can be difficult to find, and young adults will be covered for a few years after graduation as they enter the workforce. Hearing loss can develop at all ranges of childhood and adolescence, and those affected experience a lifetime of regular check-ups and screenings. For young adults with these types of pre-existing conditions, this item is a welcome relief.
Fact 2: All pre-existing conditions are covered. This is one of the PPACA topics that pretty much everyone can agree on as a positive, despite whichever political wing you stand on. (How it’s executed, of course, remains up to partisan debate.) The “except this” clauses found in coverage allowed insurance companies to dance around pre-existing conditions. This change in the law comes in two steps. First, until 2014, a new program is available for those who’ve been unable to obtain insurance for at least six months due to a pre-existing condition. Come 2014, insurance companies can no longer deny a person coverage due to the state of their health.
This change has the potential to impact just about anyone over the course of their life - unforeseen health and insurance circumstances can change life situations pretty quickly. As many hearing conditions develop between birth and adolescence, this extended coverage has offered a measure of relief. However, it doesn’t necessarily mean that all aspects of hearing care are covered – it’s a little more complicated than that. Which leads us to the next point…
Fact 3: Hearing aids are not required to be covered. The PPACA expands coverage to many things, but hearing aids are not part of that. However, that doesn’t mean that they won’t be covered by a provider - they’re just not required to be covered. The gulf between federal and state laws affects this particular issue, as hearing aids are not part of any federal health care act. Currently 19 states require some form of coverage by insurance providers, and even then, certain exemptions apply. Hearing aids come in many different shapes, sizes, and prices - from $500 to several thousand dollars - and the final cost to the patient can be based on various conditions, technological features and physical fitting needs.
Why aren’t hearing aids covered by the federal government? They’re considered an elective treatment, such as LASIK surgery.
Fact 4: Flexible spending accounts are changing and may change even further. The primary change for flexible spending accounts (which do qualify hearing aids and hearing aid repair as tax-deductible items, though it is up to the plan provider to accept them) is a cap at $2,500. For just about everyone, this is a reduction, as most plan providers put the previous cap at $5,000. However, current discussion exists as to just how to handle the overflow of remaining funds often left in flexible spending accounts. In fact, the Department Of Treasury was taking in public comments up until mid-August regarding what to do with the use-it-or-lose-it model. So while flexible spending contributions will definitely be capped at a lower amount, there’s still some gray area on the topic in general.
Fact 5: Small business get tax credits for offering health insurance: This issue is another key point of partisan debate, but here are the non-political nuts and bolts - small businesses of up to 25 employees averaging less than $50,000 in salary (thus, law firms and the like aren’t included) can get 35% in health-care tax deductions. In 2014, that’s up to 50% for for-profits and 35% for non-profits. Keep in mind that businesses under 50 employees are exempt from penalties. Those are the facts; the pro-PPACA side claims that it creates incentives for small businesses to provide health care at little risk while the anti-PPACA side believes it penalizes too many businesses over 50 employees.
Fact 6: You may be getting money back…or maybe not. The PPACA requires insurance companies to distribute rebates based on their Medical Lose Ratio (MLR). Depending on where your insurance company falls in its MLR, you may be getting (or have received) a rebate check. Whether or not you receive one depends on MLR compared to the applicable 85/15 (companies with more than 50 employees) or 80/20 rule (individuals and smaller companies). However, caveats apply. First, MLR is applied on a state-by-state basis. Second, companies themselves decide on allocation of any rebates — that means that the company may apply the rebate to further health care expenses (e.g. lower co-payments) or share the rebate among employees.
Fact 7: Children will get more free preventative health screenings. Under the PPACA, children and adolescents will get more free preventative health screenings, including obesity and vision. Newborns will get a free auditory screening to help diagnose and treat any hearing issues that arise during birth. This is particularly important as hearing loss is the most common birth defect among newborns (affecting three in 1000 children).
Fact 8: Seniors will get more free services and options. The health and wellness of senior citizens is one of the main goals of the PPACA, and it opens the door to a number of services and options. Annual wellness check-ups are now free; on top of that, senior citizens will have more provider options to choose from, as the PPACA is providing incentives for primary care doctors and surgeons to treat Medicare patients. As nearly 1/3 of seniors between 65 and 74 experience hearing loss, any form of expanded coverage is absolutely welcome.
Fact 9: Medicare’s “donut hole” coverage is closed. Technically known as the Medicare Part D Coverage Gap, the so-called donut hole refers to the gap between prescription drug expenditures of $2,700 and $6,154. The US Department of Health & Human Services estimates that nearly a quarter of senior citizens stop taking their prescription medication when they hit this gap, which could lead to catastrophic health risks. Between now and 2020, the gap will be closed through a number of processes until it is completely eliminated, allowing senior citizens to better manage the health care budget.
Fact 10: The poorest Americans will have expanded Medicaid coverage if their state opts in. Medicaid expansion was a primary component of the original PPACA draft, as it raised the availability rate to people making up to 133% of the defined poverty line - this includes adults with dependent children. However, the PPACA originally mandated that states take this expansion with the threat of taking away all federal Medicaid funding for non-compliance; the June 28 Supreme Court decision struck this state mandate down, making this expansion an optional part of the Medicaid program - one that requires states to review their budgets and decide from there.
For audiology patients, the PPACA offers many options, along with new details to learn such as the updates to flexible spending. Keep in mind that having health insurance isn’t necessarily a guarantee for audiology coverage. Other factors, such as the coverage plan, state laws, and more, help to define just what you’re getting and how much you’ll be paying for it. Some plans cover screenings and other hearing-related issues, either through their own system or an outside provider such as HearPO.
Remember, regardless of the pros and cons of the PPACA, your health care is ultimately in your hands - your questions, your concerns, your knowledge. The safest, best bet for today and tomorrow is to educate yourself with as many facts as possible, then get in touch with your provider regarding coverage details, requirements and specifics.