Today's U.S. Supreme Court decision affirming the constitutionality of the Affordable Care Act means -- as Ed Fensholt, attorney and compliance expert at insurer Lockton Inc., says -- "The train is on the track and going full speed ahead."
How could that affect retirement planning, particularly for those of us who are at the stage of life when insurance has been hard to buy, and what will the impact be for Medicare recipients? For the most part, these questions haven't yet been fully answered. But here are a couple of issues for people thinking about retirement to consider:
The law gives more access to information necessary to evaluate the performance of health care providers. Jane Hyatt Thorpe, associate research professor at the Department of Health Policy at the George Washington University School of Public Health, calls this part of the law the most significant for Medicare recipients. The law provides for evaluations of physicians based on quality measures culled from patient data, colleague evaluations, hospital records and consumer satisfaction reports. Doctors who don't meet or exceed the standards face financial penalties. But more important, armed with this information, patients can vote with their feet and go elsewhere.
More tools to end health care fraud. "There are incredibly high rates of fraud in the Medicare system. This law puts real focus on enforcement to both protect Medicare recipients from fraudulent practices and save taxpayers money," Thorpe says.
Greater availability of insurance. If you aren't old enough for Medicare, this law makes it easier for you to buy insurance, even though you have health conditions that previously would have led insurance companies to reject you. The law also provides financial help for more people who are unable to pay the going rate for health insurance.
Fensholt says today's decision makes this part of the law murkier. The Supreme Court wrote in its decision that the provision in the Affordable Care Act to deny states Medicaid funding if they fail to expand their Medicaid program to cover potential recipients who make more than 100 percent but less than 133 percent of the federal poverty level is possibly unconstitutional. The court agreed to overlook the issue if the federal government doesn't enforce the cutoff provision.
"How this will play out isn't clear," Fensholt says, "The federal government could construe the law to say if you can't get into your state's Medicaid program, then you are eligible for an exchange program, but the law doesn't explicitly say that. We might have people caught in the middle."