Medicaid Issues for People with Disabilities
Medicaid is the nation’s primary health insurance program for persons with disabilities and low-income populations. The program currently covers 60 million low-income Americans including nearly 30 million low-income children, 15 million adults and 8 million non-elderly people with disabilities. The federal government sets minimum eligibility levels for coverage and then states have the option to expand eligibility. Medicaid is jointly funded by states and the federal government. The federal government pays an average of 57 percent of Medicaid costs, with a range of 50 to 76 percent. Medicaid programs have different names in each state (for instance, Medical in California).
Medicaid is a lifeline for most people with significant disabilities who have greater medical needs and often require assistance with activities of daily living throughout their lifetimes, such as getting dressed, taking medication, preparing meals, and managing money. Medicaid is overwhelmingly the largest funding source of both acute health care and long term services and supports for most of our constituents since people with disabilities who are covered by Medicaid generally do not have access to employer based or other private coverage.
Roughly three-fourths of people with disabilities who receive Medicaid are considered “mandatory” beneficiaries because they receive Supplemental Security Income (SSI) benefits. People with disabilities with incomes and resources above SSI levels can be covered by states as “optional” beneficiaries. Medicaid offers certain mandatory services, such as hospital, physician and nursing home services. States can also choose to offer optional services -- including prescription drugs; physical, occupational and/or speech therapy and related services; diagnostic, screening, and preventive services; home and community based services (under waiver programs and as state plan options); case management services; durable medical equipment (e.g. wheelchairs), prosthetic or orthotic devices; personal care services; rehabilitative and habilitative services; dental and vision care; Intermediate Care Facilities for people with mental retardation and related conditions (ICF/MR); and hospice care. For children specifically, states are required to cover all children under age 19 whose family income is under the federal poverty level ($22,050 per year for a family of four in 2010 ) and all children under age 6 whose family income is up to a third above poverty. Many states opt to cover additional children, such as those with high health needs. Medicaid’s Early and Periodic Screening, Diagnosis and Treatment (EPSDT) program specifically designed for children with low incomes and/or high health needs.
Despite numerous significant improvements to the Medicaid program for people with disabilities in the new health care reform law, there remain a number of issues that will continue to affect our constituents for years to come. Specific issues of concern are:
Proposals to Block Grant the Medicaid Program
On March 20, 2012 House Budget Committee Chairman Paul Ryan released his Fiscal Year 2013 spending plan (known as a budget resolution). Among other things, this plan would block grant the Medicaid program which would be devastating for our constituents. People with I/DD no longer would be entitled to health care or to long term services. And with a fixed amount of severely reduced funding, states would then be forced to cut eligibility, benefits, and provider payments. People with disabilties stand to greatly lose access to physicians, medications, therapies, medicial equipment, and many other crucial products and services. Worse yet, states could go back to institutionalizing people with disabilities to save money since they would no longer have to meet the quality standards currently imposed by the Medicaid program for nursing homes or community based services. Read more...
Institutional Bias of Home and Community Based Services (HCBS)
Currently, 57% of Medicaid’s long term care funding goes to institutional care. This bias towards institutional care is due to the fact that nursing home services are mandatory for states, while HCBS are optional. States currently have two main options to fund HCBS – the HCBS waiver (Section 1915(c)) or the HCBS state plan option (Section 1915(i)). The 1915(c) waiver is only available to individuals who qualify for an institutional level of care. Under this waiver, states can cap the number of eligible people, keep waiting lists, and limit services to certain geographic areas. Additionally, states must apply for renewal of the waiver from Medicaid which is a complex and lengthy process. The 1915(i) state plan option, on the other hand, allows states to have eligibility that is below the institutional level of care - before people need nursing home care. Due to the new health care reform law, as of April , 2010, the 1915(i) state plan option no longer allows states to cap the number of eligible people, keep waiting lists, and limit services to certain geographic areas. They may target services to certain population groups.
Despite the inclusion of the Community First Choice (CFC) Option in the new health care reform law, the bias toward institutional care in Medicaid remains. The CFC option which would provide for attendant services and supports is, by definition, optional for states. Though states that choose this option will receive a 6% increase in their FMAP for HCBS services, it remains to be seen how many states actually choose the CFC option when it become effective in 2011 given the current state budget crises. Unless states choose the CFC option, they continue to be allowed to maintain waiting lists for HCBS under their 1915(c) waivers, have caps on services, and restrict services to certain parts of their state. Similarly, in the past very few states have chosen to use the 1915(i) state plan option and there is no incentive for them to do so in the future.
HCBS Waiting Lists
Due to the limited number of HCBS slots in states, there are currently over 300,000 people with disabilities on waiting lists for home and community based long term services and supports across the country. The wait can be as long as 8-10 years. This crisis results in unnecessary, unwanted and costly institutional care; family members being forced to quit jobs or take on second jobs to help care for their loved one; and having to leave their loved ones unattended or in the care of unqualified persons.
Provider Reimbursement Rates
Medicaid reimbursement rates for primary care physicians, specialists and dentists are very low. This is one of the major reasons why people with disabilities lack access to quality medical and dental care. The new health reform law increases Medicaid reimbursement rates for physicians and pediatricians (but not specialists) for two years (2013 and 2014). Hopefully Congress will extend this increase and cover specialists and dentists.
Funding for Services
The economic recession has caused many states to make drastic reductions in their Medicaid programs, which are having devastating effects on people with disabilities, families and communities. In response, the federal government provided a temporary increase in the federal share of Medicaid spending (known as the Federal Medical Assistance Percentage (FMAP)). The American Recovery and Reinvestment Act provided states with a temporary increase in the federal share of Medicaid payments from October 1, 2000 through December 31, 2010 to help support Medicaid and state budgets during the recession when demand for programs increases and states have less ability to finance care. To be eligible for these increased funds, states could not restrict eligibility levels or make it more difficult for individuals to apply for coverage. Later, Congress extended the increased FMAP to states through June 2011.
To help take pressure off state Medicaid budgets in the long term, advocates will be encouraging employers and individuals to participate in the new national long term care insurance program, the Community Living Assistance Services and Supports (CLASS) program, which was scheduled to became effective in January, 2011. The date was pushed back as policymakers grapple with design of the program.
Dual Eligibles
There are approximately 9.2 million people who are eligible for both Medicaid and Medicare, referred to as dual eligibles or duals. Individuals with disabilities under the age of 65 comprise about 38% (3.4 million) of duals and estimates of the percentage of duals that are individuals with intellectual and developmental disabilities (I/DD) vary from 5% to 18%. Duals represent 21% of Medicare beneficiaries and account for 36% of Medicare costs. Similarly, dual eligibles constitute 15% of Medicaid enrollees, but account for 39% of the program’s costs. Over 60% of dual eligible beneficiaries have incomes below the poverty level. They also require a complex array of services from a variety of providers across different settings. In short, duals are people with high needs who are very poor.