Money in the Middle

Sandwich Generation Talking About Money Up, Down and Across Generations

Health Care Reform: What’s in it for Sandwich Generation?

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Now that the maneuvering and rhetoric is dying down (sort of), we’re trying to figure out what health care reform will mean to us – personally.  And for most of us, there just isn’t enough information yet to understand what it will mean to our cost of health insurance or our kids.  

But there are a couple of provisions for the sandwich generation that look to have an immediate impact on older and younger generations.  If you are looking for a good summary of the highlights of the law, try these “explainer” articles from Kaiser Health News.

 Getting young adults health insurance – dependent coverage for adult children up to age 26 for all individual and group policies.  Lot’s of young adults are without health insurance as they were forced to roll off their parents policy and yet to land a job with health insurance benefits.  This give families with insurance a bit of peace of mind as those young adults find work with benefits (hopefully soon).

 Closing the Part D doughnut hole – On the other side of the “sandwich” is Medicare beneficiaries.   There’s good news for those with Part D prescription drug coverage who find they drop into the doughnut hole and facing the full expense of prescription drugs while also paying insurance premiums. If you’ve every helped someone choose a Part D plan or decipher what gets covered or not covered, you know what I mean. 

The law begins to phase out the doughnut hole in 2011 as well as require pharmaceutical manufacturers to provide a 50% discount on bran-name prescriptions filled in the coverage gap. 

This year, those falling into the doughnut hole will receive a $250 rebate.  No word yet on how it will be implemented but it’s welcome relief for Part D participants. 

Long-term Care – A government long-term care insurance program (referred to as CLASS- Community Living Assistance services and supports) was rolled into the bill and got little attention amidst the bigger issues. No details yet on how it will work or how much it will cost workers (it will generally be offered through employers and provides a minimal level of benefit ($50-$75 per day), but it gives hope to those who can’t qualify for long-term care insurance that there is a way to buy some protection against long-term care costs.  I’ll cover this more in a future post.  If you’re interested in reading more, this is a good summary from the American Association for Long-term Care Insurance (AALTCI)  

Over the next several weeks, I’ll be providing more information on what’s in the health care reform bill and how it impacts the sandwich generation. For baby boomers  planning for retirement, understanding health care costs in the future will be critical to figuring out how much money you’ll need.  A recent survey from Fidelity Investments says a 65-year-old couple today should have $250,000 socked away for health care costs in retirement –not counting long-term care costs.

 If there is something in the health care reform bill you’d particularlypleased about or would  like to hear more about, post it here.


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