Monday, January 7, 2013

Health Care Reform Implementation Timeline

Based on a Kaiser Family Foundation timeline. For more detail, visit

Insurance Reforms in 2010
• Provides insurance coverage to individuals with pre-existing conditions through temporary high-risk pools.
• Prohibits insurers from denying coverage to children based on a pre-existing condition.
• Allows young adults to stay on their parents’ insurance plans until age 26.
• Prohibits insurers from placing lifetime dollar limits on coverage.
• Prohibits insurers from dropping coverage when a beneficiary becomes ill — a practice called recission.
• Creates a temporary reinsurance program for employers providing health insurance coverage to retirees over age 55 who are not eligible for Medicare.


• Provides a $250 rebate to Medicare beneficiaries who reach the Part D “donut hole” in 2010.

Long-Term Care in 2011

• Establishes a national, voluntary, long-term care insurance program (CLASS program), which will provide a cash benefit to enrollees for the purchase of long-term care services.


• Eliminates cost-sharing for preventive services such as colonoscopies and mammograms in Medicare.
• Provides Medicare beneficiaries with a free annual check up.
• Gives Medicare beneficiaries who reach the Part D “donut hole” a 50 percent discount on brand-name prescriptions and a seven percent discount on generic prescriptions.
• Restructures payments to Medicare Advantage plans by setting payments to different percentages of traditional Medicare rates.
• Prohibits Medicare Advantage plans from imposing higher cost-sharing requirements for some Medicare covered benefits than is required under traditional Medicare.
• Freezes the income threshold for income-related Medicare Part B premiums for 2011 through 2019 at 2010 levels, and reduces the Medicare Part D premium subsidy for those with incomes above $85,000/individual and $170,000/couple.


• Creates the State Balancing Incentive Program
in Medicaid to provide increased federal Medicaid matching payments to states to increase non-institutionally based long-term care services.
• Establishes the Community First Choice Option in Medicaid to provide community-based support services to people with disabilities.

Medicare in 2012

• Reduces Medicare payments to hospitals that have preventable hospital re-admissions.
• Provides bonus payments to high-quality Medicare Advantage plans.

Tax Changes

• Increases the threshold for the itemized deduction for unreimbursed medical expenses from 7.5 percent of adjusted gross income to 10 percent of adjusted gross income for regular tax purposes and waives the increase for individuals age 65 and older for tax years 2013 through 2016.
• Increases the Medicare Part A (hospital insurance) tax rate on earnings over $200,000 per individual and $250,000 per couple, and imposes a tax increase on unearned income for higher-income taxpayers.
• Eliminates the tax-deduction for employers who receive Medicare Part D retiree drug subsidy payments.

Individual and Employer Requirements in 2014

• Requires insurers to offer coverage and renewal of insurance to individuals regardless of health status and limits premium variation.
• Sets limits on annual out-of-pocket health costs for those with incomes of up to 400 percent of the federal poverty level (FPL) as follows:
–100–200% FPL: $1,983/individual, $3,967/family;
–200–300% FPL: $2,975/individual, $5,950/family;
–300–400% FPL: $3,987/individual, $7,973/family.

Premium Subsidies

• Provides refundable and advanceable premium credits and cost sharing subsidies to eligible individuals and families with incomes between 133–400 percent of FPL to purchase insurance through the Exchanges.
• Reduces the out-of-pocket costs for prescriptions while an enrollee is in the coverage gap before becoming eligible for catastrophic coverage.
• Establishes an Independent Payment Advisory Board to submit legislative proposals for Medicare cost-savings.
• Requires Medicare Advantage plans to spend 85 percent of every dollar they receive on health care.


• Requires that states extend spousal impoverishment protections to participants in their HCBS (home- or community-based care) waiver programs, HCBS state plan benefit, and Community First Choice benefit (through 2019).

Tax Changes in 2015 and Later

• Imposes a tax on insurers of employer-sponsored health plans with values that exceed $10,200 for individual coverage and $27,500 for family coverage (effective 1/1/2018).
• Between 2010 and 2020, the Part D “donut hole” will be gradually closed.

This information is provided as a public service and is not intended as legal advice. Such advice should be obtained from a qualified Elder and Special Needs Law attorney.

Wednesday, January 2, 2013

Why Work With An Elder Law Attorney

Why Work with an Elder Law Attorney?

Seniors face complex legal concerns that are often different from what they faced when they were younger. Actions taken may have unintended legal effects. As a senior or someone who’s helping make decisions for a senior, it’s important that you work with an attorney who specializes in Elder Law.

What Is Elder Law?

Elder Law encompasses many different fields of law. An Elder Law attorney specializes in how to best use their knowledge to fit the needs of seniors. Some of these fields include:

• Preservation/transfer of assets seeking to avoid spousal impoverishment when a spouse enters a nursing home

• Medicaid

• Medicare claims and appeals

• Social security and disability claims and appeals

• Supplemental and long-term health insurance issues

• Disability planning, including use of durable powers of attorney, living trusts, "living wills," for financial management and health care decisions, and other means of delegating management and decision-making to another in case of incompetency or incapacity

• Conservatorships and guardianships

• Estate planning, including planning for the management of one's estate during life and its disposition on death through the use of trusts, wills, and other planning documents

• Probate

• Administration and management of trusts and estates

• Long-term care placements in nursing home and life care communities

• Nursing home issues including questions of patients' rights and nursing home quality

• Elder abuse and fraud recovery cases

• Housing issues, including discrimination and home equity conversions

• Age discrimination in employment

• Retirement, including public and private retirement benefits, survivor benefits, and pension benefits

• Health law
• Mental health law

Most Elder Law attorneys do not specialize in every one of these areas, so when an attorney says he or she practices Elder Law, find out which of these matters he or she handles. You will want to hire the attorney who regularly handles matters in the area of concern in your particular case and who will know enough about the other fields to question whether the action being taken might be affected by laws in any of the other areas of law. For example, if you are going to rewrite your will and your spouse is ill, the estate planner needs to know enough about Medicaid to know whether it is an issue with regard to your spouse's inheritance.

Tuesday, January 1, 2013

NAELA Report on Senate "Fiscal Cliff" Legislation

The Senate “Fiscal Cliff” Legislation

The Senate passed a compromise bill, the American Taxpayer Relief Act of 2012, to avert the fiscal cliff at about 2 a.m. January by an overwhelming 89-8 vote. The deal was brokered by Vice President Biden and Minority Leader Mitch McConnell. The House has not voted on the bill and there are reports that the Republicans are overwhelmingly opposed to the deal (in part because it does not cut enough spending) and will need to amend the bill in order to secure the necessary votes. If the bill is amended and sent back to the Senate, it may loose support from the Democrats in the Senate and the White House.

The bill addresses many of the outstanding fiscal cliff concerns, including the
Bush era tax rates, estate and gift tax rates, Medicare reimbursement, and the sequester, among numerous other issues. In addition, federal unemployment benefits would be extended for a year without a budget offset elsewhere.

The bill will extend current tax rates for individuals earning less than $400,000 and couples earning less than $450,000. Tax rates will revert to the Clinton-era rate of 39.6% from 35% for those making more than $400,000.

The estate tax exemption will remain the same as 2012 at $5.12 million per person (and will be indexed for inflation). Effective January 1, 2013, the top estate tax rate will increase from 35% to 40%. These rates and exemption levels are permanently extended. Portability is also extended and the gift tax exemption will remain at $5 million as well.

The payroll tax holiday will not be extended for another year. Since 2011, the payroll tax rate, which funds Social Security, was 4.2%. The payroll tax rate will now revert to the pre-2010 level of 6.2%.

The bill addressed sequestration and delayed the automatic spending cuts by two months until March 1, 2013. The cost of continuing current spending levels will be paid equally through tax revenue increases and later spending cuts (half of those $12 billion in cuts will come from defense and half of those cuts from nondefense spending). The bill reduces the total amount of the sequester by $24 billion over nine years.

There is a one year “doc fix” included in the bill. This “doc fix” prevents the scheduled 27% reimbursement cuts to Medicare physicians. The “doc fix” will not be paid through cuts to the Affordable Care Act or to beneficiaries.

Also included in the bill, and of particular interest to NAELA members, are the repeal of the CLASS Act and the establishment of a Commission on Long-Term Care. It is reported that President Obama agreed to repeal the CLASS program in exchange for Republicans agreeing to raise the tax rates on the wealthiest Americans.

NAELA’s public policy team is closely monitoring the creation of a Commission on Long-Term Care. The Commission will “develop a plan for the establishment, implementation, and financing of a comprehensive, coordinated, and high-quality system that ensures the availability of long-term services and supports.” The Commission will investigate the interaction between Medicare, Medicaid, and private long-term care insurance. The Commission should account for demographic changes and trends in order to improve the delivery system for long-term services and supports. The Commission will consist of 15 members with the President, Senate majority leader, Senate minority leader, Speaker of the House, and House minority leader each appointing 3 members. Members will represent the interests of consumers, older adults, family caregivers, health care workforce, private long-term care insurance, State insurance departments, and State Medicaid agencies.