Medicaid Up Date Impacts on Community Based Care
February 1, the U.S. House of Representatives approved the FY 06 Budget Reconciliation Bill by a vote of 216 to 214. Already, the House Budget Chair, Jim Nussle (R-Iowa), and Chair of the Senate Budget Committee, Senator Judd Gregg (R-NH), are considering another set of entitlement spending cuts this year, and will most likely be proposing a Budget Reconciliation measure for FY07, in the coming months. The measure, as passed, makes significant changes to Medicaid: * The Budget Reconciliation Conference Report allows states the option to force many low-income Medicaid recipients, with and without disabilities, to pay more for their care. If these individuals cannot shoulder the costs, states would be permitted to deny beneficiaries access to necessary medical care. Studies have found that when people cannot afford cost-sharing, they will forego necessary care, resulting in adverse health outcomes. These provisions are bad public health policy and inconsistent with valuing the lives of persons with disabilities * Many analysts report that due to drafting errors, the bill has no limits on cost sharing for Medicaid beneficiaries below 100 percent of the federal poverty level (approximately $800 per month for an individual). This means that SSI beneficiaries with disabilities could be required to pay any level of cost sharing their Governor chooses. * The reconciliation package exacerbates the institutional bias through its application of premiums on Medicaid beneficiaries. Persons with disabilities living in the community can be charged substantial premiums while those in institutions are exempt. This is inconsistent with efforts to eliminate the institutional bias in Medicaid under President Bush's New Freedom Initiative. * Medicaid beneficiaries with incomes from 100 - 150 percent of the Federal Poverty Level (approximately $800 - $1200 monthly for an individual) could be required to pay up to five percent of their monthly income for co-pays for all Medicaid services. * Unlike current Medicaid law, cost sharing is enforceable under this bill, meaning that the provision of a Medicaid service may be conditioned on the receipt of the co-pay. For example, a pharmacist can refuse to dispense a prescription drug if the beneficiary fails to pay the co-pay. In practice, this means a person could be forced into an institutional setting because he or she is denied medicines needed to remain in the community due to the inability to meet cost-sharing obligations. WHAT DOES SECTION 6086 DO? The bill creates a new state option that purports to expand access to community services for Medicaid beneficiaries with income up to 150% of the poverty level without requiring individuals to need an institutional level of care. However, it allows for enrollment caps and waiting lists that could actually limit access to services individuals need to maintain their independence; it renders obsolete Medicaid's existing protections that ensure personal care, rehabilitation and certain other optional services are provided to all Medicaid beneficiaries who need them; it aggravates the already untenable institutional bias in Medicaid; and it would operate without the additional oversight and protections for consumers afforded by waivers under current law. Section 6086 is regressive for the following reasons: * Caps Eligibility and Permits Waiting Lists. Section 6068 grants states new authority to cap a state plan service and maintain waiting lists - a dangerous precedent that weakens Medicaid's protections without even the minimal federal oversight provided through waivers. * Weakens Existing Benefit Protections. This bill effectively removes the existing entitlement to personal care (currently offered in 30 states plus DC) and rehabilitation services (currently offered in 46 states plus DC) for individuals with disabilities by permitting states to shift the delivery of personal care and rehabilitation services to the new state option. The new option would permit enrollment caps and allow states to provide community services only in certain parts of a state. * Increases Medicaid's Institutional Bias. Section 6086 does nothing to increase eligibility for Medicaid, but instead gives states expanded tools for limiting access to cost-effective community services. Further, it permits stricter income and resource eligibility rules for community services than for institutional services. Since this does nothing to reduce the need for long-term services it could only lead to more people being forced into costly institutions. * No Meaningful Grandfathering Provision. Although the Senate passed bill would have permitted states to tighten eligibility for new enrollees, but maintain eligibility for beneficiaries already receiving services if participation was greater than the state expected, the Senate bill did not permit enrollment caps. The Senate bill's so-called adjustment authority was intended as an explicit alternative to enrollment caps as a way for states to manage their financial risk. The conference report does not include this policy. Section 6086 permits enrollment caps and permits states to grandfather recipients for only 12 months, negating any benefit of this new policy approach. * Does Nothing to Help States Comply with Olmstead. More than six years ago, the Supreme Court issued its landmark decision in the case of Olmstead v. L.C. that interpreted a state's obligations under Medicaid to comply with the Americans with Disabilities Act. The Court found that unjustified isolation in nursing homes was illegal discrimination and called for states to provide access to community services when appropriate and when it can be reasonably accommodated to help move people out of institutions. If states maintain waiting lists, they are still supposed to move at a "reasonable pace". The latest data show that in some states, people with disabilities have to wait two or more years to receive the community services they need. Section 6086 does nothing to shorten the length of the waiting period for services.
