Health-care reform offers options for boomers

Colorado baby boomers would do well to study the details of the looming Patient Protection and Affordable Care Act. It may well save many of them thousands of dollars a year and offer them better health coverage than they currently are receiving.

Boomers nationwide are in an intriguing position as “Obamacare” and its state insurance exchanges approach implementation on Jan. 1. While the reform movement certainly wasn’t directed at the boomers’ generation, it does recognize the reality that many boomers either are retired or nearing the traditional retirement age of 65.

In an article entitled “Boomers may benefit most from Obamacare,” the Wall Street Journal predicted that Boomers may be uniquely positioned to find that life will improve once the reform act is fully implemented.

“There were several things that were included (in the PPACA) that really target boomers reaching retirement soon,” said Chris Stein, faculty instructor at Colorado State University’s Department of Finance and Real Estate. “The gradual closing from now until 2020 of the prescription drug ‘doughnut hole’ is a very popular one with retirees as it reduces the chance you will have huge prescription drug costs during the ‘coverage gap’ that exists in the pre-ACA Medicare programs.”

The reform act increases preventive services that are covered for seniors and simplifies and reduces the cost of obtaining coverage for those from 55 to 64, both of which benefit boomers, Stein said.

Getting used to the new rules and options may pose some problems for this generation that has become accustomed to the roller-coaster ride of health costs and insurance.

“I think boomers might feel more affected since the ACA really changes how things have worked for years,” Stein said. “Those generations coming behind are just as affected, but they will live more of their lives under these new rules, so they won’t probably experience the feeling of uncertainty about how this is all going to work that many boomers are experiencing today.”

Colorado boomers stand to benefit more than boomers in many other states because Colorado has embraced the Act’s mandated insurance-exchange concept. The state’s exchange, Connect for Health Colorado, is among the more robust in the nation. With 18 insurers participating in the exchange (versus as few as two or three in some states), residents have 541 individual plans from which to choose. It was among the group of 13 states that first posted rates so that consumers could begin to sort through their options.

The PPACA is perhaps the most thoroughly studied and researched piece of U.S. legislation in history – with forecasts aplenty about how it will work. Trends from the research are emerging, and many of these will fall differently on boomers than other generations. Among them:

Finding insurance despite age and medical condition: Many boomers, because of age and pre-existing conditions, have had trouble getting health insurance at any cost. For those people, health-care reform is a godsend. They will be able to get insurance through the state exchange, and probably at a fairly reasonable cost. They can’t be denied.

Canceled or slashed company retirement plans: Many employers are considering modifying or shutting down their retirement plans. They may offer a buyout deal. The important thing to know is that corporate retirement plans may be at risk, so it’s a good idea to start shopping on the exchange now for coverage until Medicare kicks in.

Jumping the corporate ship: For those who are sick of clocking in every day but don’t want to retire, the insurance exchange can allow their inner entrepreneur to emerge at last. With reasonable coverage available for individuals and small business, millions will no longer have to rely on a company-sponsored benefits plan in order to survive. They may even be able to keep their former jobs but work as an independent contractor.

Spousal coverage: For those who are covered by their employers’ plans and have spouses covered by that plan, the spouses may lose that coverage. Several large employers have informed workers that they will no longer cover spouses who work elsewhere and can get coverage there. This can impact boomers more so than younger workers because of the various health problems that come with age.

Gaps in coverage: Gaps may occur in coverage as the monumental shifts inspired by the Act ripple through the health-insurance landscape. Those who retire or plan to retire before age 65 may face one of these gaps, Stein said.

“Many (boomers) have been covered by their group plans at work, and when they retire before age 65, they sometimes find themselves unable to afford to remain in the group plan and/or unable to qualify for individual insurance for a variety of reasons, including pre-existing conditions. The ACA addresses some of these issues, including removing the pre-existing condition barrier on individual plans,” he said.

He cautions those about to retire “to assess all their options for health insurance before heading to their retirement party.”

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