Medicare helps reduce senior poverty

Medicare helps reduce senior poverty


Poverty Awareness Month ended in January but that doesn’t mean that we should forget right away the strong connection between poverty and health, and take some time to take into consideration the challenges of senior poverty that will come in the future.

Millions of American seniors are struggling with poverty. According to statistics, one in four Medicare users has less than $15,000 in total savings, and close to one in twelve is either with no savings, or is in debt. There are also some big discrepancies between racial and ethnic groups: median per capita savings in white Medicare users is over six times bigger than black or Hispanic Medicare users. Such statistics show the role Medicare has in protecting seniors from downright scary health care costs.

Even with Medicare, however, some users have to pay some rather high out-of-pocket costs. Among Medicare users that have income which is below the national poverty level (which is approximately $12,000 a year per person), 38.7% will spend more than a fifth of their annual income on premiums and out-of-pocket medical costs. In order to spare seniors from paying these costs, it is of great importance that we take care of the underlying high costs of health care.

The first thing we should do is to work on lowering the costs for prescription drugs with the help of the Administration’s commitment. Such are some expanded policies that would assist Medicare users to save on coinsurance for drugs that have been administered in some hospitals, which would in turn, save millions of dollars on out-of-pocket costs that would be incurred by these drugs. Some policies exist as well, and they would help for Medicare Advantage and Part D plans to have more tools available to them when negotiating to lower the costs for some drugs, which would then lower the costs the users would have to pay. Last, but not least, there is an advance notice of proposed rulemaking to seek comments on an innovative drug pricing model that will help reduce the Medicare costs for physician-administered drugs in Part B, as well as improve the overall quality of care for such users.

Low-income Medicare users can also receive help by states, advocates, and community organizers, as they will connect them with programs that provide assistance with Medicare premiums and cost sharing such as Medicare Savings Programs and Extra Help. Medicare users can see their costs reduced by over $1,600 per year by most of the state-based Medicare Savings Programs, and that can be done by covering Medicare Part B premiums – money that beneficiaries can put to good use, like food, housing, or some other life necessities. Millions of Americans are able to use the Medicare Savings Programs, but have not done so yet. States that are interested in this can also do some changes that would make the enrolment process easier.

Recently, CMS launched their new “What’s Covered” application, which is designed to be a part of their eMedicare initiative that focuses on modernizing Medicare and provide patients all the information they need to get the most of their Medicare coverage. “What’s Covered” makes it easier for people under Original Medicare, caregivers, and other beneficiaries to find out if Medicare covers some specific service or item. Beneficiaries can use their smartphones to get an up-to-date coverage information in the doctor’s office, hospital, or at any other place, they can use their smartphones.

Medicare aside, HHS also has programs that might provide assistance to seniors, and one of those is the Low Income Home Energy Assistance Program, a program that helps with heating costs for low-income households.

Programs like these can be of great importance for seniors to be able to have a better quality of life. It is important to be aware of the importance of innovation and the connection of health and social services, and, because of that, further work is needed in order to integrate services and pay attention to social determinants through Innovation Center models, as well as the Accountable Health Communities Model, a model that provides support for local communities that seek to improve their health social needs of Medicare and Medicaid users by bringing together the clinical and community service providers.

With the help of innovation, new partners, and a mindset for more affordable health care, there are some tools that help reduce senior poverty all over the country. States that are interested into providing access to such programs, or want to learn more about how to make the administrative process for Medicare Savings Programs easier should contact their local State Health Insurance Assistance Program (SHIP), or pay a visit to the Medicare Savings Programs, as well as Extra Help CMS websites.

We can Help! Our local advisors can help your family make a confident decision about senior living.

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Sholem Berkowitz
Sholem Berkowitz

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